#85: 75% Prefer To Hire Freelancers In Uncertain Economy, Google CEO tells workforce their unproductive, Spotify went fully remote...Turnover dropped
Recession, Google, and Spotify...how do these three combine for a big win for the freelance economy?
Leaders, it’s been a grind the past two weeks. Apologies for the delayed updates. This week we’ll discuss:
What does the recession mean for the freelance economy
Why Google CEO Sundar Pichai telling employees their unproductive is a win for the freelance economy
How Spotify dropped churn through their RTO strategy (return to office…hint they put autonomy in their employees hands)
Let’s roll! Oh… also Luca 👇
🤔 Do Leaders Hire More Freelancers In A Recession?
According to my personal visibility: Yes, BUT…
leaders trim the fat of poor performing freelancers
leaders double down on freelancers they already turn to
leaders double down on freelancers working on core business
This is echoed by Bloomberg News as according to Jo Constantz, “More Than 75% of US Businesses Prefer to Hire Freelancers in Uncertain Economy”.
Interesting supportive data from his article:
78% of business leaders said they are more likely to hire freelancers rather than full-time employees while economic conditions remain uncertain
85% of US companies plan to implement a hiring freeze during the current downturn
78% plan to lay workers off
It’s not all good news…
“Some companies still don’t even know how many external workers they employ. An investment firm Malcolm worked with recently was “astounded” to find one division was made up of 30% contractors. Another division had 50%.”
Wait until they find out Google is over half contractors…
Honestly I’m least surprised by this. Contingent spend is generally $1b+ in large companies, yet external talent is typically grouped in with total vendor spend without freelancers being integrated into strategic planning.
This will change, and below are some great leaders to show us why:
Flop of the week: Google CEO tells workers they’re unproductive.
According to CEO Sundar Pichai:
“There are real concerns that our productivity as a whole is not where it needs to be for the head count we have.”
He then asked employees to help “create a culture that is more mission-focused, more focused on our products, more customer focused. We should think about how we can minimize distractions and really raise the bar on both product excellence and productivity.”
A couple reasons this makes me smile.
The success criteria of productivity, business results, and innovation are more tightly aligned in hiring freelancers than hiring full time.
Next week we’ll break down an article from Morten Bruun, ex McKinsey and Google on why.
Because of this alignment, leaders prioritizing freelancers can outcompete their counterparts selling free lunches, free massages, and those other lavish tech perks that are impractical in times of business uncertainty.
This means you leaders already hiring freelancers are wayyyyy ahead of the curve!
Win of the Week: Spotify
The headline says it all. But briefly digging deeper, a discreet important detail is that they put the autonomy in the employees hands. Instead of all remote or all office, they their Work From Anywhere Policy “lets employees determine how often they work from the office and where they work, as long as the company has an operation there”.
Need some help driving awareness for why your org needs to hire freelancers? Forward this!
We sent this 3 times this week…John Garvey, Global Financial Services Leader at PwC, writing “The biggest cost reduction opportunity in financial services? It’s the gig economy”.
Key Learnings:
Cost is their main driver.
Changes to demand are their secondary reason as “greater use of gig workers overall greatly improves the ability of the business to flex to meet changes in demand”.
Inflation and decreased growth prospects are a catalyst.
He says, “With increasing inflation and lowered economic growth prospects, the road will not get any easier for the foreseeable future.”
Forward away!
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