Digital Onboarding

Deep Dive: Gig Economy Onboarding And The Push For Faster Payments

Digital solutions have made their way into the gig economy, with more workers than ever utilizing digital marketplaces that pair companies with talent from around the world. These days, however, gig jobs don’t just encompass rideshare drivers, home renters or handymen on popular platforms like Uber, Airbnb or TaskRabbit. Gig work is now available in nearly every industry, and it is beginning to disrupt traditional ideas regarding career paths and earnings. 

According to a recent report, slightly more than one third of the U.S. workforce (36 percent) participated in the gig economy during 2018. That figure is projected to increase to 43 percent by 2020. 

There are many reasons why a greater number of workers are now turning to the gig economy, such as the schedule flexibility and workflow and income control that comes with these types of jobs. The gig economy isn’t only beneficial for workers, however. Companies are also turning to digital marketplaces to tap into workers’ expertise while lowering operating costs. 

Digital onboarding in the gig economy 

The initial connection between workers and employers is made online, and many gig workers conduct the entirety of their contract online as well, never setting foot inside an office. A December 2018 survey from Connect Solutions found that this kind of remote employment offers perks for both workers and employers. According to the survey, productivity can improve up to 77 percent when workers are offsite and can control their work environments. 

The benefits of gig work are obvious for both sides of the equation, but there are some pitfalls. Onboarding typically requires new employees to provide various kinds of personal information, such as names, addresses, work histories, education and certifications, among other details. Digitally focused companies will likely have online forms potential workers can use to submit their information, but others might rely on time-consuming, intensive manual processes. 

Employees’ information must be verified once it’s in the system. Employers need to be certain that workers are who they say they are, and that they have the skills necessary for the job. This creates lags in remote employees’ workflows and makes them financially unstable — they’re forced to wait until the verification process is complete before they can start earning funds. These slow processes also put pressure on firms that want quick turnaround for freelance projects. 

Digital marketplaces can mitigate this friction, lower companies’ costs and save precious time. Interested workers can input their personal and professional information on the marketplace, which then authenticates each user, eliminating that step for companies that want to employ them. Many marketplaces act as go-betweens for firms looking to hire remote or freelance workers by offering time-tracking options to ensure correct payments, payment transfers in various currencies, communication and collaboration options, tax estimates or compliance help, healthcare options and other work-related issues. In addition, these platforms help filter potential candidates to find the best ones for the job. 

Gig work payments in the digital marketplace

Firms of all sizes are finding great use for the gig economy. Accenture’s Technology Vision 2017 report found 100 of the Fortune 500 companies already used digital marketplaces to hire freelancers. Additionally, a LinkedIn survey found that approximately 53 percent of small firm managers expect to hire more gig workers in the coming years, with 75 percent of organizations already increasing their reliance on freelance employees. To keep these figures on track, though, companies must ensure that gig workers’ needs are being met. 

Payments are a common concern in the digital economy. Companies need to be sure they’re paying for quality work, often trusting individuals they’ve have never met to produce important projects.

Once again, digital marketplaces have solutions for these woes. These platforms can transfer money securely with blockchain-enabled transactions, which keep the funds safe from cybercrime while adhering to global financial regulations. The same technology that monitors payments also improves digital marketplace onboarding and retention efforts, providing more robust pictures of freelancers through workflow tracking and reviews, and incentivizing quality and promoting competition. 

Marketplaces also help gig workers get paid faster for their work. According to a soon-to-be-released report from PYMNTS, workers who sourced their jobs through digital marketplaces in Q4 2018 were paid faster than those who did not, with 26.6 percent being paid instantly. This helps gig workers better manage their finances as they know exactly when their income will be accessible to them. Faster payments also encourage gig workers to take on more assignments in the future and foster better relationships between companies and freelancers, promoting partnerships and gig economy growth. 

As the world continues to go digital, companies and freelancers alike are understanding the flexibility and financial perks that come from gig economy work. Digital marketplaces could be the bridge that helps both groups flourish by way of ad hoc opportunities. 

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Latest Insights: 

The Payments 2022 Study: Building A High-Performance Payments Team For Fraud Detection, a PYMNTS collaboration with Stripe, examines how digital platforms of all sectors and sizes plan to develop their anti-fraud teams as part of their their broader growth and development strategies. Drawing from an extensive survey from approximately 250 payments heads at digital platforms in the U.S. and abroad, our study analyzes how poor anti-fraud capabilities can harm platforms’ long-term growth strategies, and how they can build high-performing teams to tackle these challenges.

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