You’ve very likely heard of the “gig economy” – the growing trend of people picking up jobs here and there, often through online platforms or apps – rather than having a full time job. The trend is changing the workforce. And that means that the talent equation for businesses is starting to shift.

For privately-owned businesses, the emergence of the gig economy could be an opportunity that will help you grow your business, but there are also some pitfalls to watch out for.

The biggest consideration when seeing whether you can plug your company into the gig economy is to know that the freelance talent base is expanding. A 2015 survey showed that 54 million Americans are working as freelancers, an increase of 700,000 from the previous year. Most of them are working freelance by choice.

This means that, more than ever before, companies can tap into talent for specific projects when they need it. In other words, you can scale up and scale down your workforce as your needs change. This can make your company more agile and able to meet specific customer requests or market opportunities.

Embracing freelance workers can also have a positive impact on the bottom line; companies can reduce full-time headcount, and also reduce health benefit costs.

However, there can be issues to navigate. Freelance workers are, on the whole, professional and committed to producing quality work on time. But as an employer, you don’t “own” a freelancer’s time—they are, by definition, working for other companies, and they may prioritize that work ahead of yours. There could come a time when this could leave you in a pinch.

Another potential pitfall is on the legal front: Companies that employ freelance workers must be sure to classify them correctly. This topic has been in the news frequently over the last year or so, as the debate rages on over whether drivers for car service Uber are “independent contractors,” as the company claims, or should be considered employees, as the state of New York declared in October. The Department of Labor has vigorously worked to ensure workers don’t get misclassified and that they receive their full rights as workers.

Despite these pitfalls, the gig economy is an opportunity for companies to smartly access a greater talent pool and grow their business. You just have to be sure to do it the right way.

Contact us at 215.441.4600 or Email if you have questions or would like to discuss how this topic may impact your business.

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