Rethinking the ‘gig economy’: How shifting dynamics require a new perspective

The phrase ‘gig economy’ has been around for a long time, but it achieved true buzzword status about 4-5 years ago. In that short time, the meaning of it has completely transformed.

When I first heard it, I thought it sounded like a tough way to make money. It stirred up images of someone in a constant state of hustle, running from one part-time job to the next in order to – barely – make ends meet. Back then, I never would have connected the phrase to someone who was serious about building a full-time career based on specialized expertise and experience.

Despite it being just that, ‘gig economy’ can still carry a negative connotation for employers and other workplace professionals who are unfamiliar with the benefits and true meaning. Misconceptions that we at Paro continue to hear about the gig economy workforce include:

• They can’t keep a full-time, permanent job.
• There is little to no job security.
• They have no loyalty to a company.
• They don’t take work or their profession seriously.
• They don’t crave success or career growth.
• We should sympathize with them because they are working nonstop to make a living.

Those plentiful and inaccurate reasons are why we should strike the phrase ‘gig economy’ from our vernacular. Consider it a swear word from here on out. There are so many more appropriate names for an incredible and successful workforce that prioritizes flexibility, autonomy, and work-life balance. A few terms we should be using instead: freelance economy, fractional experts (including CFOs), professional services economy, independent consultants/workforce, solopreneurs, or flexible/agile workforce.

The shift from trendy buzzword to a legitimate workforce model started before COVID-19, but the pandemic really accelerated it. Research shows that by 2027, 86.5 million people will be freelancing in the United States. That’s more than 50% of the total U.S. workforce. With that many people choosing the freelance career path, the term ‘gig economy’ feels too informal and misleading. It’s no longer about short-term gigs but about building a sustainable, long-term career through freelancing and developing a business on your own terms.

According to Paro’s own research, about 30% of people feel bored at their current jobs. Seeking more meaningful work, many often turn to freelancing, sometimes in specialized roles like fractional controller services. For employers who need the help but don’t have a full-time workload or a full-time budget, freelancers offer an excellent option. These workers are passionate and skilled, and they add value within your budget and time frame. In Paro’s network, for example, we have some customers using freelancers for just 10 hours a week, even if they’ve been partnered together for over two years.

In this new world of work, more people will continue to test and embrace careers as independent contractors for a number of reasons, including:

• Flexibility: Pursuing work on their own terms, reimagining the way they work, having the autonomy to decide who to work with, when they want, where they want
• More meaningful work: Growing and developing their own careers doing work they are interested in and passionate about (not the same thing every day)
• Work-life balance: Escaping the 9-5 grind, setting their own hours, prioritizing wellbeing

Given what workers are prioritizing, more companies must continue to eschew the traditional hiring model and evolve with the modern freelance experience with a greater focus on the following:

• The future of work: Fractional, seasonal, contract, and/or remote employees can help drive successful outcomes during busy seasons and beyond, enable full-time employees to perform at a higher level, provide the ability to scale up and down as needed, and deliver more precise skills to fill specific business needs and more niche skill sets for smaller projects.
• Retention: It is more important than ever for employers to listen to the needs of their people and adapt accordingly. Quality talent is getting harder and harder to find, so companies must show flexibility in who to hire and where and when. Retention is unique – if you can retain talent better than other companies, you are ahead.
• Culture: Workers are prioritizing work-life balance over compensation, and people leave jobs because of stress, feeling underappreciated, and too much bureaucracy. This might require a cultural shift within the organization, but it will pay dividends in the long run.

Related: Here’s how to understand and help gig workers

Millions of people have reassessed their careers over the past few years, and as such, the work landscape looks more different than ever. With this rapidly changing professional backdrop, the future of work requires companies to adapt their perspectives and embrace new and sometimes unconventional ways of tapping into talent.

Evolving with this shift not only ensures a competitive edge in attracting top-tier talent but also fosters a dynamic and responsive organizational framework. By recognizing and leveraging the diverse skills and experience of freelance professionals, companies can make a more resolute commitment to building sustained success in the evolving business environment.

Anita Samojednik is the Chief Executive Officer at Paro, a Chicago-based startup disrupting the way companies access on-demand financial expertise.