The growing global gig economy
The 9-to-5 workday, birthed from nineteenth century socialism, is starting to look irrelevant. The economy has progressed since the First Industrial Revolution and work itself has evolved significantly.
The evolution of the internet and software companies gave rise to a global gig economy, one that goes far beyond just Uber drivers and Fiverr designers. A decentralised global workforce, known as the Human Cloud, is growing rapidly — The Economist estimates that it is worth $50 billion a year.
The Human Cloud is alleviating poverty in the poorest places on earth. The Kenyan government is building a new digital workforce by equipping one million young adults with basic computer skills.
With a computer and access to the internet, individuals can get paid for working on micro-tasks such as data entry, transcription, and simple product tagging and categorisation.
This presents a win-win situation: Companies enjoy significant cost savings by outsourcing micro-tasks to the Human Cloud, and workers benefit from a new source of revenue.
“Our users are everywhere. We have to be, too”
In addition to accessing a global gig economy, companies are also exploring new organisational structures and workflow to successfully accommodate full-time remote workers.
Stripe’s CTO, David Singleton, has recently announced that the company’s fifth engineering hub will be remote, stating that more than a hundred remote engineers will be hired this year. The first four engineering hubs are physical offices located in San Francisco, Singapore, Seattle, and Dublin. Singleton believes that an independent remote engineering hub is the next step.
We are doing this to situate product development closer to our customers, improve our ability to tap the 99.74 percent of talented engineers living outside the metro areas of our first four hubs, and further our mission of increasing the GDP of the internet.
Stripe is hardly the first prominent tech company to go remote. Companies like Buffer, Basecamp, and Github have all embraced the movement and made remote working a possibility.
While not every job can be done over the internet, jobs in functions like data management, engineering, digital marketing, and design are better enabled to work independently and remotely today.
Why go remote?
Healthier, more productive employees
Anyone who has experienced a rush hour commute in any metropolis in the world would understand how stressful and unpleasant it can be. Spending hours in slow traffic and packed trains isn’t a productive use of anyone’s time.
Employers should consider the viability of going remote seriously for its benefits. For starters, employees stand to save on transportation costs and reduce their carbon footprint. They can also experience a better work-life balance, as the flexibility of a remote arrangement allows them to fit their work around their commitments, such as taking care of children or ageing parents, or allocating more time to activities that improve physical and mental wellness.
In a remote working arrangement, employees are given the freedom to work wherever and whenever they feel the most productive. Not everyone performs best working in an office, especially in one with an open concept. Some may prefer to work from home, while others may pick their favourite spot at a neighbourhood coffee shop or co-working space.
Instead of spending tons of money to create conducive spaces in the office to inspire productive work, companies can consider allowing employees to pick what’s best for them.
Access to global talent
A Boston Consulting Group report projected that between 2020 to 2030, significant labour force imbalances — shortages in particular — will be a $10 trillion problem experienced by 25 major economies globally:
Trends across the 25 economies we studied are alarming: an equilibrium in [workforce] supply and demand is rapidly becoming the exception, not the norm… One significant implication is the potential aggregate value of GDP squandered, because either these nations cannot fill the jobs available or they cannot create enough jobs for the workers they have. This represents a stunning $10 trillion — around 60 percent of U.S. GDP and more than 10 percent of total world GDP.
Stripe recognises the problem: talent is always in short supply locally. Hiring within its engineering hubs in San Francisco, Seattle, Dublin, and Singapore can limit the company from tapping on a greater pool of talented individuals living in other areas of the world.
Jonathan Siddharth, the CEO of Turing, shared in a private interview that he believes that more and more software companies will explore the possibility of having geo-distributed teams, especially in the software engineering department.
“Talent is universal, but opportunity is not. Companies and startups that tap into the global talent pool will win, as they will be able to double their runway and hire elite engineers they otherwise can’t afford. This is why we believe every company’s second engineering office should be remote.”
“The inevitable future of work will be large remote teams. Stripe, from what I hear, has gone to significant lengths to make a culture that can work this way. Once a few big companies prove [the success of remote teams], startups will follow suit and create a new, global talent war like we’ve never seen before.”
Because we can
There is no better time to embrace remote working arrangements. Powerful collaboration and communications tools are making remote work more convenient than ever.
Slack allows us to communicate with coworkers effectively. Google Docs and Trello help us work and review projects in real time. Need face time? Zoom brings everyone into one room.
Buffer, for example, operates as a fully remote team. It is certainly no easy feat for a company with almost 80 employees working in different continents and timezones to go remote. According to several blog posts and Glassdoor reviews, they feel that it was a great decision, as employees receive the freedom to work wherever and whenever they feel the most productive.
To align everyone and make sure every employee in the company feels a sense of belonging, they arrange Zoom calls regularly, plan for team retreats, and even organise remote hackathons.
Lasting economic impact
The gig economy might be the most impactful and meaningful contribution from the proliferation of the internet for our society.
In his tweet, Suhail Doshi paints a probable picture in which developers in rural cities get remunerated with a comparable salary to their counterparts in the Silicon Valley.
If your workforce is global, you have the ability to compensate fair SV market prices globally. Imagine a smart, self-taught Kenyan engineer who is able to help their family making over $150,000 a year. Imagine they make money post-IPO and become investors.
With a higher income, workers are now more empowered to spend and contribute more in their local communities. The investment and expenditure in the local economy will begin to stimulate further economic activity and development, helping to keep these rural cities and towns sustainable.
Alexis Ohanian Sr., the co-founder of Reddit and Managing Partner of Initialized Capital, suggests in a tweet that suburban cities and college towns — towns or districts predominantly occupied by its university population — in first-world countries can also stand to benefit from a decentralised workforce.
As remote work continues to get even more productive and more common, college towns with a decent city built around them are going to thrive. More and more graduates will not want to leave their idyllic lifestyle when they can command great salaries doing work they love from home.
As the infrastructure and tools to facilitate the movement of remote work become more accessible and affordable to all, we will experience a greater economic impact and sustainability, a more equitable distribution of income, and a better quality of life.