March 24, 2021 7 min read
Opinions expressed by Entrepreneur contributors are their own.
Is it time to drop the word ‘gig’ from ‘gig economy’? Nobody says ‘smartphone’ any more, since nearly all phones are smart. And we’re now at a stage where on-demand, as-needed work appears to be the future of work; not for all jobs, but for many. A McKinsey survey found 61 per cent of companies expecting to hire more short-term help in the years ahead. Other studies show the practice on the rise in all categories from professional to blue-collar work.
Twin forces drive the trend—employers’ needs for flexibility in changing markets, plus people’s needs or desires to work-hop accordingly—and the impact can be seen vividly in the startup realm. Many new companies want flexible staffing to feed growth, while others emerge to provide and support the human capital required.
Our Southeast Asian VC firm is watching it happen across the 10-country ASEAN region. The movement often plays out uniquely in this diverse part of the world, where rapid modernization, especially in mobile technology, combines with traditional institutions that endure. Here’s an anonymized example. Startup A has been promoting its mobile payment app in Indonesia, a sprawling country of over 270 million. One key step was to onboard warung merchants: the operators of local eateries that range from tiny roadside stalls to actual restaurants. Since warungs exist throughout the country, getting them on the payment platform would mean canvassing selected areas in person. Startup B, an on-demand staffing company, provided teams for the job within a few days.
The new staffing industry is centered around marketplaces that match offline gigs with real-world giggers. Other elements are required to make this mode of work really sing, however, from tools for managing flexible staffs to training workers for jobs most in demand. For a quick overview of some leading players and business models in five industry sectors, both globally and in Southeast Asia, read on.
Marketplaces for on-demand staffing
One reason companies use flexible staffing is to handle periodic project work. This typically involves white-collar workers such as Web developers or graphic designers, and a leading online marketplace for this talent is US-based Upwork. Clients needing help post their projects on the website, and can then interview and choose from freelancers who bid on the work.
Many marketplace startups in Southeast Asia are different, as there are more needs for blue- and gray-collar work. GoGet, in Malaysia, has an interesting double-platform model. The ‘business’ portal provides on-demand workers ranging from laborers to data entry staff and helpers for trade shows, while the ‘home & life’ portal allows individuals to hire personal shoppers, household help, line standers and more. Meanwhile the Indonesian firm Sampingan (a Golden Gate Ventures portfolio company) focuses on offering a turnkey approach to business clients. Along with a very broad pool of blue/gray collar workers—even including nano influencers for online marketing—the company has a suite of work-management tools and services. Some firms have made the latter a key product line in itself.
Scheduling and staff management
For client companies, using flexible hourly workers is trickier than with salaried employees. Each person may be available only at specified times. Yet all must be brought aboard efficiently, scheduled in teams as needed, and time-clocked for payment. WurkNow, a US firm, offers a mobile-based system that uses blockchain to coordinate everything. In Vietnam, where contract manufacturing for global outfits like Samsung is a big part of the economy, the startup Viet.co has found a niche by serving small to midsized companies with on-demand workers and management tools as well. StaffAny, based in Singapore, has a management suite that enables people to work across companies. This can help workers to mix and match opportunities while making the overall ASEAN workforce more fluid. And in Indonesia, AdaKerjam, is blending these value-add services together, with scheduling, payroll, and recruiting rolled into one service.
Early wage access
Both in the West and in Southeast Asia, early wage access (EWA) programs are popular among workers who strain to live from paycheck to paycheck. EWA can either let you take out pre-payday loans at rates well below the predatory, or simply get money now for hours you’ve worked so far. Companies like Branch and PayActiv are early US leaders in this area. Prominent ASEAN startups include GajiGesa, Wagely and Gajiku.
EWA services typically come as part of a bundle. Branch, for example, sells an enterprise package that integrates EWA with scheduling and payroll management. PayActiv, Wagely and others give workers a ‘financial wellness’ system to help them plan and manage their own budgets.
Facilitating cross-border work
To a large degree, international hiring is driven by the ease of virtual remote work and the general globalization of economies. Our VC firm is headquartered in Singapore but draws upon work from people located far and wide, and it’s also not uncommon for Southeast Asians to cross borders physically between home and a job. Such arrangements are great for tapping talent but a headache in terms of complying with various countries’ employment regulations. Firms like Deel in the US and Papaya Global in Israel have arisen to handle the complexities; each can address compliance in over 140 countries. Singapore-based Multiplier specializes in cutting cross-border costs and expanding talent access for ASEAN companies, a crucial need for startups that are growing region-wide.
US-based Lambda School, with online career programs in coding and data science, has an innovative deferred-tuition model: you can choose to pay out of your resulting salary, when and if you land a tech job earning over $50,000 per year. (If you cannot get such a job, you don’t pay.) In China, where government work is an important and often prestigious means of employment, Offcn Education Technologies has climbed to unicorn status with courses for civil-service exam prep and training, along with teacher training and vocational courses.
ASEAN governments are growing more supportive of on-demand work. Indonesia’s 2020 ‘omnibus bill’ eased labor laws to permit rapid temporary hiring, while the country also launched a massive program to speed recovery from the economic impacts of COVID-19. Unemployed persons can now get a prakerja (“pre-employment”) account that gives them near-term social assistance and pays for back-to-work training.
The prakerja program has the double benefit of helping people and stimulating the startup ecosystem. New firms like Kitalulus have been founded to conduct the training, while more established startups also get a boost. Ruangguru, a fast-growing EdTech company, has a mobile platform for online tutoring and self-instruction in primary and secondary-school subjects. Now it’s branching out to offer a training platform for businesses. If both the core line and the new one keep growing, they’ll produce a company able to provide mobile-based learning at every stage from first grade to midlife career change.
Outsourcing helped to flatten the world. On-demand work is the next evolution. Ideally, it will make economies more efficient and effective for all.
As for Southeast Asia: on-demand startups here do face challenges. For example, prequalifying blue collar workers is tough in places where an excellent truck driver or warehouse worker may not even have a resume. But ASEAN offers a host of advantages for breeding innovation. The region is big (total population nearly 700 million), growing, and mobile-friendly. Its diversity along multiple dimensions—Singapore alone has four official languages—forces startups to be in versatile growth mode from day one. As the future of work emerges, expect to see a lot of it emerging in Southeast Asia.
With contributions from Nidhi Singh.