2015 was the year the on-demand economy landed. From delivery, transportation and household errands, to professional services and consulting, the on-demand economy has been broadly adopted, especially in urban centers.
This has spawned debate about how best to support people working on-demand jobs and on worker classification, asking the question: Should people engaged in on-demand work be considered employees or independent contractors?
This discussion will only gain momentum over the year ahead. That’s because the number of people working on-demand jobs is expected to grow, with just 13% of Brits expecting to be working in a traditional role in a decade, according to research conducted by Intuit.
On the face of this, the focus of the debate needs to change quickly away from trying to categorise workers, to focusing on how best to empower people working on-demand jobs.
We’re already seeing examples of the evolution of the debate with recent calls from business secretary, Sajid Javid, and economist, Diane Coyle, for a radical overhaul of UK productivity and economic growth figures to ensure that the contribution of the sharing economy can be taken into account.
With this fresh perspective in mind, here are four predictions for how the on-demand economy debate will evolve as 2016 progresses.
The debate will focus on the future of work
From class-action lawsuits to new worker classifications and on-demand worker unionisation, the employee versus contractor debate has been central to discussions about the on-demand economy.
As more data becomes available in 2016, this debate will become increasingly nuanced. For example, recent research shows that six per cent of Brits now use sharing economy services to supplement or create income. A third of those individuals, using the likes of AirBnB and Etsy, are making between £101 and £500 per week, 19% are earning between £501 and £1,500 per week and three per cent are even making between £1,501 and £5,000 per week.
The idea of one traditional job sustaining a family is becoming a relic. As more and more data exposes this trend, the employee versus contractor choice is going to be seen as increasingly outdated. The debate will instead focus on empowering those who take control of their careers by juggling multiple jobs.
The on-demand economy must become a priority for Government
The on-demand economy is but the latest spike in a 30-year trend toward increasing self-employment. The self-employed workforce in the UK was 8.7% in 1975 and by 2014 had risen to 15%, or nearly five million individuals. This is a profound structural change to our labour market that demands attention at the highest levels of government.
In 2016, Government must acknowledge the needs of the growing ranks of the self-employed. Ideally, debate will include discussion around how to provide stable benefits for people who chose to pursue on-demand work or self-employment while also providing innovative companies with the space to continue creating jobs, wealth and opportunity.
The on-demand economy will no longer be defined by ride-sharing and delivery services alone
To date, most attention on the on-demand economy has focused on companies operating in the transportation, delivery and home services industries, like Uber, Airbnb, Etsy and TaskRabbit.
In 2016, we will see an increasing focus around on-demand platforms that offer professional services such as consulting, legal expertise, copy writing, graphic design and human-resources services.
This will further entrench the on-demand economy in society, as large companies change the ways in which they conduct business, looking to on-demand providers for services that traditionally took place in-house.
Young, male Londoners will be the face of the trend
New research from Intuit has revealed the face of the typical sharing economy user: a 25-34 year old (50%) male (58%) Londoner (37%). The study also found that two in five (39%) use profits made to save for the future, while a quarter (26%) spend cash made on luxuries or entertainment. Fourteen per cent said they use it to pay bills.
In 2016, on-demand economy platforms will increasingly engage and incentivise this unique demographic pool of potential workers.
If I have one wish for 2016, it’s that we’ll embrace the positive opportunities that the on-demand economy provides and that we will view it within the broader context of a changing labour market. I believe that this is the first step toward a mindset shift that will allow us to build the new tools and infrastructure needed to support the growing self-employed workforce.
There needs to be a more informed, nuanced and productive discussion in the year ahead, as we begin to understand the vital role the on-demand economy can play in powering a new generation of entrepreneurs.