They help with digitization, are specialists in their field and can be deployed flexibly: solo self-employed and employees of external companies. A large proportion of companies cannot do without them, according to a new survey by the Institute of German Economy (IW) shows. If their use were to be further regulated, that could be a braking factor, especially when it comes to digitization and climate protection.
Every fourth company relies on specialized external personnel, the study led by Dr. Oliver Stettes, Head of the Working Environment and Collective Bargaining Policy Cluster at the IW, determined. Solo self-employed and contractor workers are an important means of meeting a temporary need. At the same time, they are available quickly and bring with them specific know-how that their own employees lack.
Four out of ten companies that hire self-employed people use them in IT. In the case of relatives from external companies, it is three out of ten. In the past two years, more modern technologies have been integrated into the work processes where external personnel are used than anywhere else. Solo self-employed help with the introduction of digital frontier technologies, such as artificial intelligence and virtual reality. Specialists from external companies play an important role in the installation and integration of digitization technologies that are already ready for use. In this way, they accelerate the digital transformation of companies.
Solo self-employed as a catalyst for digitization
Specifically, the study examined whether companies that employed solo self-employed workers or contract workers from external companies in 2021 were further along in the digital transformation of business models or processes than companies that had refrained from using them. In fact, it can be observed that companies that use external staff have on average implemented a larger total number of digitization technologies in recent years than comparable companies without such use. It is 0.26 measures higher for clients of self-employed persons and 0.59 measures higher for contract employees from external companies.
The use of solo self-employed people is also associated with a significantly higher probability that methods of virtual or digitally augmented reality and systems of artificial intelligence have been introduced recently. Both types of technology are currently still among the less common digitization technologies. On the other hand, companies that use contract workers from external companies are more likely to have implemented cloud services, digital distribution channels, big data analysis and additive manufacturing processes in the last two years. At least the first three mentioned can be counted among the more mature digitization technologies.
Eliminate barriers to contracting
External personnel is not only relevant for the economic development of the individual company, but for the German economy as a whole. However, commissioning them is often still time-consuming and legally uncertain for companies. Service and work contracts are often under general suspicion – wrongly so. “Companies ask about solo self-employment and work contracts because they have a very specific need. That creates flexibility and speed,” says IW Director Michael Hüther. “Such instruments are very important in German companies, especially against the background of the major transformation tasks.” Further regulations, on the other hand, could be a braking factor, for example in digitization and climate protection.
The full study of dr Oliver Stettes, Head of the Working Environment and Collective Bargaining Policy clustercan here at Institute of the German economy be downloaded
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