Is the gig economy the key to the success of the microbusiness?

COVID-19 has forced many small businesses and entrepreneurs to pivot in their business direction, with many of them registering microbusinesses from home during lockdown, causing a surge in employment.

According to an Inquiry into the Victoria On-Demand Workforce published in June 2020, as much as 14 per cent of the population had engaged in the gig economy at some point, a statistic that has not yet decreased.

The gig economy is a lifeline for small to medium enterprises, microbusinesses and entrepreneurs, providing them with the ability to continue to work or provide specialised services and generate revenue that may otherwise have been impacted by the pandemic.

The gig economy is based on flexible, temporary, or freelance jobs, often involving connecting with clients or customers through an online platform which can benefit workers, businesses, and consumers by making work more adaptable to the needs of the moment and demand for flexible lifestyles.

This movement positively affects unemployment rates and business growth and development in Australia with data showing the jobs growth was entirely driven by a surge in “non-employees” self-employed people (owner-managers) with no employees who work in an unincorporated enterprise (e.g. a sole trader).

According to the Bureau of Statistics, the number of employed persons increased by 111,000 in August 2020.

The pandemic compelled businesses to scale back with some owner-operator businesses securing the operations of their business, registering microbusinesses and prompting them to source work from alternative sources.

By registering home businesses and microbusinesses, individuals are able to reduce their operating costs, reduce their overheads and remove the income restraint that exists in less flexible business arrangements.

The digital communication revolution has also significantly lowered the cost of reaching customers, and this has been a lifeline to microbusinesses.

Digital resources for microbusinesses have become an essential part of business operations with businesses like Airtasker and BConnect assisting with the sourcing of work and growth and development of businesses.

BConnect helps Small and microbusinesses by providing them with access to services, without having to provide a financial exchange, providing access to potential revenue and providing an alternative currency to use to improve their own business services.

Online platforms like BConnect and Airtasker allow these businesses to find more revenue streams, a valuable resource considering 32 per cent of businesses are replacing full-time employees with contingent workers (including freelancers and gig workers) to cut down on costs where they can.

The benefits of the gig economy and establishment of home businesses and microbusinesses increase the opportunity for individuals to source revenue in a flexible manner that reflects the changing nature of post-COVID-19 society, a welcome relief from the unemployment uncertainty that has the potential to change existing business models in SME and large corporations.

Jason Walmsley, National Sales Manager, BBX Australia