It will come as no surprise that the Covid-19 pandemic has drastically altered the world of work for countless employees, with potentially permanent changes to how workplaces operate occurring as a result.
With 46.6% of people in employment doing some work at home in April 2020, and 86% doing so as a result of the pandemic, according to the Office for National Statistics (ONS), the surge in remote working has now been well-documented.
However, the pandemic has also seen a dramatic rise in flexible employment, with a growing number now having more than one employer.
One in seven UK workers are now in flexible employment, a number that could rise when the government’s furlough extension runs out.
This could have a significant impact on the tech sector, which relies heavily on the temporary labour market.
Keeping track of the flexible workforce is a new challenge that many businesses will have to adapt to, with companies needing to re-think how they onboard, pay and tax workers.
Software company My Digital believes that updated technology is needed to adjust to what it refers to as the quantum workforce. The company recently launched People Hub, a real-time digital accounting cloud service designed with contractors and workers employed on a part or flexi-time basis.
Verdict spoke to former HMRC adviser and My Digital’s CEO John Whelan on how employers can use technology to best serve the flexible workforce, and why legacy systems may not be up to the task.
Ellen Daniel: What is My Digital?
John Whelan: My Digital is a Quantum Employment Design (QED) platform that provides a suite of products that enables temporary workforce management for the entire temporary labour market. We believe jobs for life are history and the emergence of a quantum workforce will transform employment in the years to come. Our background in payroll, accountancy, tax, human resources and SaaS has allowed us to develop much-needed payroll, accounting and timesheets software for the temporary labour market.
What is the quantum workforce?
JW: The quantum workforce is made up of workers that deliver industry-specific skills on a flexible, incremental basis. Employers with quickly changing requirements have access to a customisable workforce which they can create for specific roles, peaks in demand or individual projects. This new way of working is breaking down work into its smallest parts, so we call this quantum employment.
Today, one in seven UK workers are on flexible contracts, this is up 25% in two decades. The contractors who work in these roles and industries make up today’s quantum workforce.
How important is the temporary labour market for the tech industry?
JW: The temporary labour market is vital for the tech industry. Technology is constantly being reviewed and updated as new innovation and more competition enters the market. However, many companies can’t afford to employ and pay the salaries of whole IT teams to keep up with the latest changes in technology. This creates a growing need for a constant supply of software developers, engineers and contractors. This is where the quantum workforce comes into their own. This group of skilled workers can offer their services to many companies and benefit financially from this way of working by diversifying their income and removing reliance on their one employer.
Taking the example of developers, computer coding is very complex and software developers are usually only able to code in a couple of specific languages. Furthermore, different developers have different skill sets based on their unique experience and technological interests. Quantum employment allows for these industry experts to lend their skills to specific tasks for different clients, rolling onto projects and rolling off onto other jobs as needed. The benefit for businesses is they can drive maximum value from the skills of multiple developers, keep on top of the latest software innovations and deliver cost savings to other key business areas supporting growth like marketing and sales.
How can technology help support the quantum workforce? How does People Hub fit into that?
JW: Previous systems for employment are highly manual and don’t allow for the speed that is required to support the quantum workforce. Consequently, payments for temporary workers take too long to be processed. We identified the need for technology that can keep up with the constant turnover of flexible workers in industries like recruitment. As more businesses turn to flexible employment over the coming months, our tech ensures that more onboarding doesn’t necessarily lead to the usual inefficiencies.
People Hub is a solution designed for this problem. This is one of our newer modules which assists our software in processing the onboarding, timesheets and payroll for some 35,000 weekly payments. Our software also provides for real-time information exchange with HMRC, handling all tax calculations. This provides transparency and speeds up the processes that are needed to manage the Quantum workforce. It’s also cloud-based so it enables inhouse IT teams to invest time in more value-added activities instead of maintenance and there’s no ‘investment’ in fast depreciating servers.
What sorts of problems can a reluctance to embrace new technology cause?
JW: The reluctance to embrace new technology is understandable when companies have invested significant amounts of time and money into existing systems. The bigger impact in the long term is the reliance on archaic systems leading to businesses falling behind in the quickly accelerating technological race. Businesses should be open to experimenting and seeing the value of new technology for solving historic problems.
Cloud-based solutions can be trialled without significant upfront investment and create synergies between different systems and distributed workforces that quickly deliver a return on investment. By using technology that improves and updates in real-time, employment, accountancy and taxation can move into the digital era. They can finally play on the same field as the tech-savvy businesses they work for!
How is quantum employment being affected by the Covid-19 pandemic and the ongoing economic uncertainty?
JW: We already saw a 3% rise in temporary workers during the months of lockdown. Thousands of people have sadly lost their jobs due to Covid-19 and permanent employment is harder to come by as businesses continue to make staff cuts. Therefore, flexible and part-time employment is being pursued by many. Pre-Covid we saw quantum employment disrupt more and more industries and this has only been accelerated by the pandemic.
Recent data from the Office for National Statistics revealed the second largest group of contractors now operates within ‘professional, scientific and technical activities’ with 610,000 UK workers. This trend has penetrated the financial and insurance sector, which currently employs 94,000 contractors. The move to remote working has also made employers more open to using contractors and made it easier for them to integrate them into workgroups. More than ever, flexi-workers are able to seamlessly provide businesses with their skill-specific services remotely without being set apart from teams working in office buildings.
Do you have any predictions for what the future of work will look like in light of the pandemic?
JW: The furlough scheme has been a saviour for both businesses and employees who otherwise would have had to look for other work sooner. However, this scheme is due to come to an end [the scheme has been extended since this interview took place]. Unfortunately, the pandemic will mean more businesses will be unable to afford to keep employees full time which will result in further redundancies on a mass scale. Businesses should make it as easy as possible for new entrants to the flexible labour market to find work and be paid on time.
In the modern age, it’s no longer acceptable for workers to have to wait weeks for payment for work served or be delayed in finding work by complicated legacy systems. As the quantum workforce develops, employees should have unfettered access to the jobs and roles they want to work in and there shouldn’t be any friction between employers fulfilling these requirements and accessing the skills and services.
How will the role of technology change?
JW: I believe that the role of technology in all industries will continue to increase and develop. The pandemic has shifted how we look at work and remote working is now essential to the survival of many businesses. There has already been a change from on-premise to cloud computing for those who need to work from the office and at home. We’re now a society of people who expect instantaneous information and the technology we use will need to keep up with that.