Sunday, March 27, 2016

How will Gig Economy Impact Your Association?

Gig economy (some call it sharing economy) is growing rapidly.

According to a story in The Wall Street Journal, the number of workers in “alternative arrangements” has climbed to 16% of the U.S. workforce (from less than 10% in 2005).
  • WSJ’s reports that the Department of Labor has four categories of “alternative work” ... independent contractors, on-call workers, temporary workers and workers employed via contract firms. 
  • A study by Alan Krueger of Princeton and Lawrence Katz of Harvard shows “gig economy” workers are in manufacturing (11%); health and education (16%); public administration (10%).

A couple of examples from “our world” ...

  • I’ve been consulting with a small, national association. In reviewing its current management structure, I noticed that an outside contract employee consumed 21% of its total staff hours. 
  • Just before selling my AMC, a larger international corporation contracted with me to provide two staff for its business. We were able to (a) increase the salaries of the two staffers and (b) reduce the cost to the company. 

What does the gig economy mean to associations and other nonprofit organizations?

How you get work done

  • take advantage of it ... rather than hiring a “permanent” person, it may be more efficient to contract with an association professional with the skill set you need for a job that really isn’t full-time all the time.

What it means to members (and donors)

  • If companies in your membership area have fewer employees, will it mean fewer members?
  • If more people within your industry or profession are full-time employees, it is unlikely they will have employers to pay member dues and/or conference fees/expenses. 
Associations need to monitor this trend. Be prepared for it. Take advantage of it.

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