Business and the economy are forever in the state of change, but a rising development will change the face of the workforce for years to come. The “Gig Economy” is rapidly taking hold across the country as more employees are becoming self-employed contractors.
We at On Time Logistics have used independent actors to staff the entire courier service side to our business since our company’s inception. This has proven to be an effective model for both us and our couriers. Logistics is an industry that easily lends itself to using contract workers, although that in of itself can have potential pitfalls.
What is the Gig Economy?
First, let’s define what we mean when we say Gig Economy. Simply put, the Gig Economy consists of independent or self-employed workers that a company can use to staff their projects without the workers being an actual company employee.
An easy differentiator is that an employee receives a W-4 to report their earnings to the government while a gig economy worker or contractor receives a 1099 form. Depending on the individual and their industry, you will find members of the Gig Economy are called various things from contract workers to freelancers.
Independent Contractors in Logistics
Like many other industries, logistics and warehousing industries can easily use independent contractors. For logistics companies like On Time Logistics, independent contractors play a pivotal role in how the company runs. We use contractors in at least two ways: the above-mentioned couriers, and we outsource our content marketing to a local, self-employed writer.
It allows for better flexibility and increased efficiency throughout the company. During the busier seasons, we can hire more couriers. We often hire people who are looking for flexible part-time work and our workload provides that opportunity.
Warehousing is another place where you will find a growing number of contract workers throughout the industry as the workload is in constant flux.
Rise in the Gig Economy
According to a 2017 study called Freelancing in America, an estimated 57.3 million Americans are freelancing (36 percent of the U.S. workforce) and contribute approximately $1.4 trillion annually to the economy. That’s an almost 30 percent since last year! By 2027, the study estimates that a majority of the workforce will be freelance or independent workers.
Several factors are contributing to the rapid increase in the Gig Economy including workers finding more stability in working for themselves in an age where layoffs are common, as well as workers also wanting to be in better control of their work/life balance. The Gig Economy is proving to be beneficial to a growing number of companies as it reduces overhead and allows them the opportunity to provide great flexibility to their workforce.
Watch out for growing concerns with the Gig Economy
With any change, there are always concerns and pitfalls. With the growing Gig Economy, there are some concerns that companies across the country will missclassify their employees as independent contractors to avoid having to obey certain employment laws.
We are careful to avoid this problem by always being cognizant how we treat our couriers and even in the language we use around their work status. Integrity and following industry and legal guidelines is always paramount at our company.
Hiring more couriers
Different factors in each industry drive change and growth. For us, it’s the drastically rising demand from e-commerce. While much of our deliveries are done by company-employed delivery drivers, we are also seeing that local courier service is also on the rapid rise. We need people in our Northwest Arkansas, Little Rock and Tulsa markets (especially the first two).
Are you interested in becoming contract courier or perhaps an employed delivery driver? We want to talk with you! If you or someone you know is interested in working for a growing company, please contact Tim Ward (Springdale) at 479-717-2206 or Tim Swindler (Little Rock) at 501-902-4650.