Gig Economy: 5 Benefits of Outsourcing

The gig economy has taken the world by storm, with more than 45 million Americans participating in it in some fashion. By 2020, one study estimates 40% of America's workforce will be self-employed through either contract work or freelancing of some sort. Previously, the biggest challenge for self-employed Americans was discovering new mediums to find work. No more. With the rise in the gig economy, these freelancers have access to millions of jobs at the click of a button. For instance, my company, WeGoLook, pairs freelance workers, or what we like to call "gig workers," with jobs across the country — and now the world — to fulfill client asset verification requirements. The rise of the gig economy isn't just a positive for these independent workers but for businesses and traditional industries, as well. The insurance industry is no different. Insurance Industry Growth and the Gig Economy According to an Insurance Institute survey, more than 40% of insurance companies plan to hire 100 or more employees between 2016 and 2017. A third of these jobs will be brand-new rather than replacements. This is becoming standard across the board as technology continues to change how the insurance industry operates. The word "outsourcing" is often misconstrued, with negative assumptions about offshore job movements and layoffs. The insurance industry, however, can easily leverage gig workers and maintain a traditional workforce. See also: 6 Points to Consider When Outsourcing   Here are five benefits to outsourcing traditional insurance work to gig workers: Worker Outsourcing Benefit #1: Looming Talent Gap A study by McKinsey & Co. revealed that 25% of insurance professionals will retire by 2018. Baby boomers are finally taking that retirement — all the millennials are applauding! This is going to leave a massive workforce gap in the insurance industry. Gig workers and outsourcing can help fill the massive vacancy left by retirees. Think gig workers aren't specialized or professional? Think again. With the rise of the gig economy, shared marketplaces and smartphone technology, gig workers are more professional, knowledgeable, trained and equipped than their freelance peers in the 1990s and 2000s. Worker Outsourcing Benefit #2: New Workforce, New Priorities Millennials are much different than their parents. They crave flexibility and experiences above all else. Sitting in a cubicle from 9 a.m. to 5 p.m. is likely not a professional priority of the typical millennial. This is why we have 53 million freelancers in America — a trend that will only increase into the future — and may be why millennials are the biggest demographic within that group. They want flexibility and the opportunity to be their own boss. This isn't to say millennials don't want full-time jobs, but the astronomical increase in gig workers in the U.S. indicates changing work priorities among millennials. By 2025, millennials will make up 75% of our workforce, so it's best we pay attention! Worker Outsourcing Benefit #3: Business Flexibility Outsourcing to gig workers will allow insurance carriers to remain flexible amid the ebb and flow of consumer demand and business requirements. More importantly for insurance carriers, on-demand workers provide flexibility because they allow companies to adjust to sudden staffing shortages when surges in demand occur. Natural disasters, for instance, place enormous pressures on claims processing and verification, right at the time when customers need it the most. Worker Outsourcing Benefit #4: Lower Costs In lieu of a full-time employee with a salary and benefits, gig workers can be leveraged to provide on-demand expertise when needed. Gig employees are much more flexible than traditional full-time employees and have more technological tools at their disposal. Now, I'm not saying an on-demand workforce replaces technical or certified field personnel, such as claims adjusters, but gig workers can augment and, in some cases, replace the full-time staffing requirement. See also: On-Demand Economy Is Just Starting   Reduced costs also emerge in the form of fleet vehicle costs, equipment maintenance, travel expenses and much more. Worker Outsourcing Benefit #5: Information Flow Now, more than ever, companies can tap into on-demand workers through various marketplaces that make up the gig economy, or what many term the “sharing economy.” The boom in the gig economy means a faster flow of information for traditional carriers because of its reliance on digital and mobile platforms. Gig workers can quickly digest information and relay it in real-time faster than a traditional employee. An insurance carrier would need to have thousands of local field agents to cover the space new sharing economy companies are covering by pooling gig worker talent. For instance, at WeGoLook we can dispatch any of our more than 26,000 “lookers” nationwide to gather information relevant to an insurance claim, asset verification, document retrieval, notary services and much more. To rival this, a traditional insurance carrier using the old employment model would need thousands of salaried positions placed strategically across the country. Or they'd require a web of complex contractors, which, in turn, would need to be closely managed by human resource professionals. This is no longer necessary thanks to the rise of the gig economy. Imagine what a workforce of 26,000 full-time employees would cost. But you can now have those employees at your fingertips just as you would if they were salaried — all by embracing the gig economy model. See also: How On-Demand Economy Can Prosper   As you can see, there are many benefits to embracing an on-demand workforce, particularly for traditional insurance carriers. This is not only because of a looming worker shortage but because hiring on-demand workers will reduce costs, increase information flow and will force the adoption of new technological trends.