News & Views

Ellie Gummer

The gig economy and the ‘Third Way of Work’

In recent months, much has been made of the ‘gig economy’. Hilary Clinton in particular, has been responsible for bringing the world’s attention to the phrase, when in July this year she commented that while the “on-demand, or so-called gig economy is creating exciting opportunities and unleashing innovation”, it is also “raising hard questions about workplace protection and what a good job will look like in the future”. I applaud Hilary Clinton for taking on the issues surrounding the changing world of work. It is a tricky topic that will change the way many of us think about the thin line between work and life. And yet, this is precisely why we should be talking about it!

The truth is that the way we work is changing, driven by the role technology has played in blurring the lines between work and home, and updated attitudes about formal work, side-projects and freelancing. It could be argued that we are witnessing the Third Way of Work.

For sure, this Third Way of Work is still a new concept, but evidence suggests it offers lots of opportunities for people looking for work to work better for them.

Earlier this year the McKinsey and Company report predicted that by 2025 as many as 60 million people around the world could benefit from the growth of online talent platforms, helping individuals find work that better suits their skills and work preferences, while an additional 50 million current freelancers could shift from informal to formal employment through such platforms. The truth is that many regard flexibility as a job benefit in its own right, and there’s plenty of anecdotal evidence to back this up – from mums fitting work around the school run, to the freelancer earning money on the side while building up their own business. My point is that there are plenty of people who value flexibility. The numbers certainly suggest so – as of January 2015, the number of freelancers in the UK was growing – and UK freelancers are earning a median income of £42,857 (FTE) and work an average of 38.2 hours per week.

That said, one of the reasons why Hilary Clinton is right to bring up the topic, is that we need to take steps now to ensure these workers embracing the ‘Third Way of Work are properly protected, particularly in the lower end of the pay spectrum.

In the UK, last year’s Government-commissioned sharing economy report made the recommendation that skill sharing platforms should agree to pay workers at least the living wage. The recent introduction of the National Living Wage by 2020 will certainly play an important role in protecting low paid workers, for example. What’s more, in the sharing economy the industry is already asking the right questions about best practice. The SEUK trademark - being developed with Oxford University’s Saïd Business School – will seek to ensure workers, consumers and businesses are properly protected in a sharing economy future.

As such, I for one do not share Hilary’s concerns about workplace protection – or at least, I am happy that in the UK the sharing economy has come together earlier enough to start talking about the issues at hand. There are great and wide-ranging benefits to the sharing economy, one of which is the flexible working options it affords individuals. We have an opportunity now to get ahead of the trend, and start laying the groundwork for a responsible flexible working future.