Alternative workers—contractors, freelancers, outsourced teams and networks, “gig” workers―represent a rapidly growing trend across the globe. It is estimated that by 2020, approximately one in five U.S. workers will be alternative workers.1 In Europe, the number of freelancers doubled between 2000 and 2014.2 There is also an increasing number of workers taking on “side gigs,” with 64% of Millennials with full-time jobs taking on outside work for extra money.3 But the gig workers are not just the younger cohorts. A Bureau of Labor Statistics survey of alternative employment arrangements released in June 2018 found that the largest cohort (37%) were workers aged 55 or older.
With low unemployment, many employers (45%)2 experience difficulty filling open positions, requiring them to reconsider how they manage alternative workers. When used strategically, alternative workers can help enhance an organization’s performance—aligning the right talent in the right place at the right time can yield optimal results.
To help attract and retain alternative workers, it is critical for organizations to decide how to apply rewards—compensation, flexibility, learning and development, and health and financial wellness benefits. The 2019 Deloitte Global Human Capital Trends study found that roughly a third of companies have implemented learning and development programs for these workers, and nearly a quarter of them award bonuses and other incentive pay.2
But what about retirement readiness? Some studies suggest that seven out of 10 full-time gig workers are unprepared for retirement, with three in 10 setting aside no money for it, while other studies found these alternative workers are more involved in their finances, actively investing for retirement.1
Conversations about retirement solutions to help meet the needs of these non-traditional workers are happening at the state and national level through innovative ideas and policy debate. In fact, Employee Benefit Research Institute held a policy forum focused on gig workers in May 2018.
The bottom line: the alternative workforce is no longer a novelty but a shift that is here to stay. Employers who develop workplace strategies that leverage this talent pool and help them to live financially well can gain a competitive edge in the war for talent.
Review your benefit plan design and engagement strategies with your Bank of America representative to see how your company can meet the needs of alternative workers.
Attend a Bank of America Legislative & Regulatory Insights webcast to hear about the latest policy developments affecting workplace benefits.
1 Pensions & Investments, Efforts to help gig economy workers save for retirement gaining ground, July 2018.
2 2019 Deloitte Global Human Capital Trends.
3 2018 Deloitte millennial survey: Millennials disappointed in business, unprepared for industry 4.0.