Platform Work and Its Relation to Employment

June 16, 20211:14 pm718 views
Platform Work and Its Relation to Employment
Image source: Rawpixel

The digital platforms as a primary mechanism for organising a vast set of human activities, such as economic, sociocultural, and political interactions have risen in the last decades. Access to digital technology gives individuals and households greater convenience and wider choices, triggering changes in purchasing and consumption behaviours. For this very reason, platform work is made available to help micro, small and medium enterprises conduct their online business and afford them global reach. Platform work is also helpful for employers to find skilled and talented workers they need. 

In-depth review: What is platform work?

European Observatory of Working Life defines platform work as an employment form for organisations and individuals to exchange information, solve specific problems, or provide specific services in exchange for payment. Platform work is created to provide flexible opportunities for earning income, helping many platform workers to achieve economic security and greater control over their working hours, develop skills, and enjoy their work. 

Platform work, also referred to as digital work or service platform, are distinct from the broader gig economy and the sharing economy. Companies operating digital platforms for individuals to hire out their skills and services for businesses or clients have experienced rapid growth in recent years. Companies such as Amazon, Etsy, Facebook, Google, Salesforce, and Uber are creating online structures that enable a wide range of human activities. This opens the way for radical changes in how we work, socialise, create value in the economy, and compete for the resulting profits. 

According to the World Economic Forum, digital work or services platforms processed around USD126bn of spending globally in 2018, and spending was up 43 percent year on year. Two companies, Uber and DiDi, accounted for around two-thirds of the platform economy by gross spend. Many platforms remain loss-making, and it is not yet clear what sustainable business models will look like. Even so, platform work is predicted to continuously grow in today’s economy. 

The challenges posed by platform work 

Although digital work is possible with the rapid adoption of technology and innovation in business models, there are challenges around platform work for the current rules and laws governing work. 

The International Labour Organisation stated that platform work can be beneficial for society at large, but at the same time, certain aspects of platform work can be problematic. Non-compliance with labour standards and lower (para)fiscal duties provide platforms with an advantage over their competitors. The demand for platform services also requires, for instance, the ability to reduce costs for user enterprises. Features like this and the global reach of online platforms can lead to intense competition between workers, often associated with low wages. In addition, these kinds of work arrangements might be prone to inferior working conditions and sustain economic insecurity. 

See also: Mobile Workforce Management Solutions 101

Other challenges posed by digital services include opaque/unfair performance evaluation and access to work, as well as dynamic wage setting and income instability. Platform services also raise issues on competition, data privacy, social and labour protection for platform workers, safety and security for customers, and taxation for the government. All these challenges require a reevaluation of existing laws and regulations. It might also amplify editing development challenges including inequalities. 

The challenge for governments and society more broadly is to harness the potential benefits from digital platforms while minimising their potential costs. Meanwhile, companies who provide or hire through platform work should be ready to engage with and manage the new workforce ecosystem of open talents. 

How to manage open talents of the platform work

An increasing number of companies in all industries and sectors are tapping into the open talent economy of the platform work. Employers can now connect with independent professionals instantly, assign them to the job that needs doing, and get them started almost immediately. The open talent economy allows employers and workers to operate on an on-demand basis, whether that is remotely or in the office. This is a necessity for many companies, as with the volatility of demand and ever-faster innovative cycles in which crowd, gig workers, freelancers, and new opportunities for automation have shifted the work landscape towards an ecosystem of open talent. 

With the rise of open talent, employers must be adhered to overcome the aforementioned challenges. With the individual becoming paramount, organisations will have to consider the needs of this workforce. Employers should be ready to offer them a challenging and supportive environment with growth opportunities and programmes while waiting for the government to fix the employment policy of this workforce. 

Building a suitable culture or facilitating personal development for non-traditional workers might be more challenging. Numerous researches found that a flexible workforce expects a common sense of purpose and a culture in which every aspect of the enterprise is aimed at increasing agility and flexibility. Therefore, to ensure the success of adopting platform workers, organisations must embrace and work closely with the legal and IT functions to give all workers clear performance goals, secure communication systems, and the right training to enable them to be productive. 

Managing platform workers should also be accompanied by building a company culture and organisational purpose that includes employees, as well as providing well-supported processes to offer employees a customised employee experience. HR together with business leaders should proactively form new leadership alliances to develop integrated workforce strategies and programmes that can help the company take advantage of the beneath of open workforce. 

Read also: Giving Recognition in Digital Workplace