The Labor Market 2.0

Marcus Meyer
Digital GEMs
Published in
6 min readJun 30, 2020
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The digital transformation of companies is no longer a question for them if they want to survive in the unpredictable environment they have to face. According to a McKinsey report from 2014, the potential loss in operating profit is estimated at 20% for a company that doesn’t succeed in its digital transformation.

With this shift has come a change in the relationship between job seekers, workers, and companies. Indeed, new patterns of working, recruitment, and challenges have emerged these last years and have removed the settings of the professional world as we used to know. Throughout this article, we will highlight some of the features of the labor market 2.0.

The gig economy is the new black!

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The ultimate goal of having a lifetime job in a safe environment is no longer what new generations are looking for. It has let place to a willingness of constant change, experiences and freedom mainly enabled by digitization. Indeed, thanks to new technologies, the current workforce is much more mobile and a lot of jobs can be done from anywhere. As a consequence, freelancers are more likely to select short-time projects with an international dimension while companies have the choice to select the best person for the project among a huge pool of talents.

That is why the gig economy, based on short-time contracts and independent missions, seems to have become a serious option for workers to consider. It is already reflected in the employment data in terms of job contracts: “More than half the jobs created in the European Union since 2010 have been offered as short-term contracts; in Australia, since 2013, two-thirds of the new jobs have been part-time; in the US, 40% of all work is now classified as contingent.” according to the Guardian (2017). This shape of the contract is a way for companies to gain flexibility and being more competitive when they have to answer a quick demand. On the other side, freelancers adopt it as a way to have control over their working hours and therefore managing better their private life by being self-employed.

Moreover, the increasing development of online platforms also promotes this trend. For instance, the website called Crème de la crème brings together thousands of talented freelancers to build a strong community, gathered around common values. It puts its community of freelancers specializing in the fields of Tech, Design and Digital Marketing through large companies to work on ambitious projects.

Furthermore, forecasters consider the gig economy as a transition phase to a new way of working. They forecast that social networks will become more job-oriented and that jobs will end to let place to “the transfer era” based on accomplishing missions for several companies without having a proper job.

A new way of working means a new way of hiring

With this shift in the world of work, the hiring criteria of employers have evolved too. Indeed, the previous features of a worker that were relevant in a stable and repetitive environment don’t match with our current one. Currently, companies are looking for good communicants that are highly skilled in soft skills. Creativity, adaptiveness, communication are part of key traits that employers are looking for to face new challenges: “Deloitte reported transferable soft skills are becoming so important that by 2030, around 2/3 of all job roles will require soft skill, intensive employees.” according to the Irish Times Training.

Consequently, this new approach puts into question the former way to assess applicants’ skills, which is the CV. Indeed, the CV is a static form, mainly based on education background and hard skills that don’t get any visible information on what people do and how they behave in the workplace. But the digital allows it!

Firms become more and more aware of this and develop new ways of assessing workers’ features that matter to them by aggregating data. This new way of recruitment is called workforce science. It lies in the idea that the data created by people online can be analyzed to forecast a person’s suitability of the job. As the New York Times said (2013) today, every e-mail, instant message, phone call, line of written code and mouse-click leaves a digital signal. These patterns can now be inexpensively collected and mined for insights into how people work and communicate, potentially opening doors to more efficiency and innovation within companies.

Here are two examples of companies that use workforce science to provide employers’ insights on their recruitment:

- KnackApp is a science-and-AI gamification web platform where companies can learn a lot from their applicants by testing their emotional intelligence, cognitive skills, working memory and propensity for risk-taking.

- LinkedIn is a place where people share their experiences, network, create content and communicate about their fields. Therefore, it enables companies to collect data and to assess individuals’ work persona. To facilitate companies to gain time and to be more accurate in their targeting of candidates, LinkedIn has also developed LinkedIn Recruiter System Connect (RSC), a tool that connects LinkedIn Recruiter and companies’ Applicant Tracking System (ATS).

This new workplace enabled by digital contains new challenges

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While this new way of working is developing itself, it creates complaints from workers because of the lack of a legal framework. Indeed, new challenges emerge, and policymakers have to handle them to make sure both employers and employees are protected.

- One of the key challenges lies in the workers’ employment status of the gig economy. Since workers are considered independent contractors and not employees, employers don’t have to fulfill their basic rights. Indeed, they have no protection against unfair dismissal, no right to redundancy payments, and no right to receive the national minimum wage, paid holiday or sickness pay as the BBC News explained (2016). It was the case for Uber, one of the pioneers of the gig economy, until January 2019 in France, when finally the Paris Court of Appeal has just qualified the link between a former Uber driver and the reservation platform as an employment contract. Deliveroo still benefits from the independent contractor status though.

- Another challenge is data protection and the use of employers. As we have seen previously, employers collect data on applicants and use algorithms to find the perfect match in terms of skills. However, they have to be careful that machines integrate demographics information as well to avoid discrimination based on many criteria.

Besides, there is a challenge in terms of employees’ personal data policy. Indeed, as employers can have access to their workers’ activity online, people’s statements or behavior on social networks can harm their career. Many cases of people being fired for tweets, Facebook statements or blogs have been recorded these last years. For instance, earlier this year, a video posted on Instagram of two workers of the French company, Le Slip Français, showed them doing blackface and wearing a monkey mask at a private party on the theme “Viva Africa”. The company decided to “summoned and dismissed them as a conservatory.” It relaunches the debate on how the private life of social workers can be an argument for employers to take action against them. Lawmakers have to state on this issue to clarify the mind of both parties.

Digital and new technologies have created a new labor market that is still in construction. While opportunities have emerged thanks to a workplace based on flexibility and a soft skills mentality, it needs a framework to embrace them with the insurance that it won’t let space for any kind of exploitation.

About this article

This article has been written by a student on the Grenoble Ecole de Management’s Advanced Masters in Digital Business Strategy. As part of a content creation assignment, students are given the task of writing articles based on their digital interests and disseminate the articles online. Articles are marked but we make minimal changes to the content. Thanks for reading! James Barisic, Programme Director, MS DBS.

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