The Gig Economy

A rising trend in Switzerland

The Gig Economy is here and contracting is in trend - also in Switzerland where contractor numbers are growing significantly. Recent studies show that more than 25% of workers in Switzerland now work as contractors with some forecasting 50% by 2030.

A recent article from Forbes.com highlighted that some of today’s top tech company cultures are modelling their workforce culture after Google.

Google has set out to distinguish itself from the stereotypical corporate world by offering a plethora of benefits not usually seen. For example, complimentary child care, free lunches and company shuttles are just 3 initiatives now being offered to new Google employees. 

But the article goes on to highlight that not all workers Google engages are applicable for these benefits. Google attracts around 121’000 temporary, vendor and contract workers (freelancers) globally and these fall out of these schemes and are generally paid less and don't enjoy a comprehensive benefits package. These workers are typically engaged for special projects or on a limited term basis for any number of reasons including HR budgetary constraints.  

This is today’s reality where more and more companies are following the growing trend of employers to engage with contractors versus full time employees. In fact, in the U.S. tech sector an estimate from the staffing platform “OnContracting” showed that tech firms used contract workers for up to 50 % of their staffing requirements. In the U.S. contractors currently make up about 20 % of the labour market with a prediction that by the end of the decade, around 50% of staffing could be made up of contractors. 

In Switzerland, a recent article written by Swisscom points to a new trend known as the Gig Economy gaining in popularity. What for many was always considered the norm – i.e. a fixed salary and regular working hours, may soon become the exception. The new trend is the Gig Economy, where minor commissions are assigned at short notice to independent freelancers or contractors.  

What is a freelance contractor?

The definition of an independent contractor or freelancer is a professional business person who can run his or her own company, but who works under contract for another business for project work or a temporary role. In Switzerland international contractors usually work via SECO licensed employment ("Umbrella") service companies to ensure that all their statutory legal payments and deductions are made according to Swiss law. Accurity GmbH is unique amongst these companies because, rather than just paying hourly wages, it offers a flexible "virtual company" model, based on a Profit Centre Account. This model enables the freelancer to enjoy a guaranteed fixed monthly salary with holidays, and to work for any number of clients in multiple currencies if required. Consequently Accurity's popularity over many years continues to rise amongst contractors, agencies, and client companies.

What are the perceived advantages?

Not only can working with contractors have a marked effect on HR resource budget constraints (thereby ultimately saving the company money), but this low asset HR approach leads to a “just in time” lean and agile staffing approach – ideal for those companies implementing special projects (e.g. for IT) or those just having won new business orders where additional workers are required for limited time periods. The “Core” company team remains (as in the case of Google).

Working with contractors also offers another benefit to the company and that is as a worker "contract to hire" possibility. This provides both the company and the contractor an opportunity to judge the fit and make sure they are in the right place. 

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