‘Sharing economy’ evokes images of homeowners advertising their parking spaces to motorists, spare bedrooms to lodgers, houses to holidaymakers or gardens to campers. There are few boundaries to what can be lent or borrowed. Even power tools, kitchen equipment, musical instruments, pets and bicycles have a value.
It’s nothing new of course. Such arrangements have been negotiated between neighbours, friends and communities for centuries, but it’s only since the internet exploded and online platforms started connecting strangers further afield that it’s been done on such a colossal scale.
The credit crunch contributed. It saw people start to scrutinise their most highly-valued assets and wonder if they weren’t being under-utilised.
The rise of the sharing economy isn’t only consumer-driven, it’s helping businesses too. There are group-buying websites for SMEs, helping them access the kinds of massive discounts on software, computers, stationery, and office equipment that would usually be reserved for massive companies ordering in bulk.
And highly skilled freelancers – some of whom were made redundant, some of whom left of their own accord to work for themselves when freelancer platforms were born –are selling their skills and services by the hour. Now, according to ONS figures, almost 15% of the UK workforce is made up of self-employed professionals, and the numbers are rising by 6.6% annually as businesses embrace freelancers and demand rises.
Because of their lower overheads, these professionals are far cheaper than the companies they once worked for, and small businesses and start-ups are suddenly able to access top-level talent at a fraction of the price.
Small businesses are becoming increasingly aware that the sharing economy can boost their bottom lines. If nothing else, it’s helping them make more sensible hiring decisions. Freelance employees, based remotely, are far less expensive and less risky than in-house perms that require paid leave, paid lunch and loo breaks, and National Insurance and pension contributions.
This is also why the sharing economy has received a lot of bad press. Low pay and poor conditions for workers who lack job security have been reported. In some industries, there are employers hiring staff as contractors to avoid paying taxes, benefits and equipment costs. It seems that sharing isn’t always caring.
But there are many people who know the risks and still choose to freelance full time, without being forced into a corner by redundancy, or top up their nine to five incomes with evening, weekend or holiday work. With the right clients, they can work from the countryside, or a sunny poolside in Spain, forego the commute, spend more time with their kids, set their own hours and decide their pay.
All the bad press is helping their cause, because it’s helping to set standards within the sharing movement. There are now freelancer sites that guarantee fair pay – far above the minimum wage – find business for them, and offer professional support and advice.
This is not only important to freelancers but to the responsible employers who hire them. Even smaller businesses are aware of the importance of CSR.
Because of the sharing economy, business owners are outsourcing the tasks that bog them down. Issuing invoices, chasing late payments, booking travel, inbox management, and designing presentations are easily delegated and free up valuable time.
If you were to break down your earnings into an hourly rate, you can bet it’s higher than what you’d pay for a freelancer to do a straightforward but time-consuming task like an expenses report. And, even if you’re a start-up earning peanuts, that hour spent invoice chasing could be an hour spent chasing a new business lead.
The sharing economy is allowing start-up entrepreneurs to access a team of multi-skilled people they could never have leaned upon 10 years ago without hiring them in. These freelance virtual assistants, PRs and marketeers, all contributing to the shared economy, are quite literally oiling the wheels of business in the UK.
Barnaby Lashbrooke founded Time Etc in 2007. The virtual workforce platform, operating in the UK and US, helps business owners and time-poor professionals get tasks done. Time Etc’s 250 vetted and tested freelancers complete 20,000 tasks month.
Further reading: One in three SMEs too busy to formulate growth strategy