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Why SMBs Are Nervous About Hiring Gig Workers For The Holidays

A new survey from research capacity building program Support of Competitive Research (SCORE) released this week suggests small- and medium-sized businesses (SMBs) in the U.S. are increasingly reliant on gig economy workers to get through the holiday rush.

SCORE, which operates a network of volunteer business mentors, published its “Small Business Jobs Report” survey data on Tuesday (Nov. 21), highlighting a 37 percent increase in SMBs’ hiring of gig workers over the last six months — more than any other type of worker — as business owners seek out specialized professionals.

Hiring increased across all categories of workers among small businesses, with hiring of part-time workers increasing 22 percent in the last six months and full-time employees increasing 13 percent. Most entrepreneurs told SCORE that hiring had become a challenge in the time frame, too, as they try to fill skills gaps for their companies ahead of the holiday season.

Nearly one-fifth of SMBs said they had replaced employees of all types with a contractor over the last six months, and 47 percent of small businesses with only one employee said they have hired more part-time workers to help run their businesses, too.

Some businesses did highlight benefits to choosing an employee rather than part-time contractor, however, with more than half citing consistency of work offering the greatest benefit. Employees also offer a commitment to the company and reduce turnaround of professionals within the same position, SMBs told SCORE.

Employers also cited concerns with the Internal Revenue Service (IRS) over hiring part-time workers, with worries that regulators would require these businesses to categorize their part-time contractors as employees anyway, or that hiring part-time workers or contractors would complicate paperwork and bookkeeping.

Amid this hiring boom, and despite a struggle to fill all the necessary positions, small businesses say they are quite optimistic about the six months ahead, with 69 percent saying they have a positive outlook about their own growth. Millennials are even more so, with 82 percent reporting they feel at least somewhat optimistic about their companies’ growth.

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New PYMNTS Study: Subscription Commerce Conversion Index – July 2020 

Staying home 24/7 has consumers turning to subscription services for both entertainment and their day-to-day needs. While that’s a great opportunity for providers, it also presents a challenge — 27.4 million consumers are looking to cancel their subscriptions because of friction and cost concerns. In the latest Subscription Commerce Conversion Index, PYMNTS reveals the five key features that can help companies keep subscribers loyal despite today’s challenging economic times.

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