The gig economy in Malaysia started booming as early as 2010 — but we witnessed its meteoric rise when the pandemic happened plus other driving factors including the excess of fresh graduates outpacing job opportunities. People were concerned about their job security, and people still are worried about whether they could keep up with the economic change today.

The gig economy covers different types of jobs, skill sets, and opportunities within its umbrella — and it sure affects many industries but one in particular is the small and medium enterprises (SMEs). For Malaysians, this means a wealth of opportunities, from accessing a broader range of talent to reducing operational costs as well as enhancing flexibility.

Access to a broad range of talent

Malaysian SMEs should take advantage of this rising economy and one of the most compelling benefits is the accessibility of the global talent pool. Traditionally, businesses were confined to hiring local employees, especially for small businesses — though that could limit their access to a much larger pool of talent with various specialised skills. With the rise of digital platforms in SMEs, businesses could potentially up their game in terms of engaging and hiring skilled professionals from all over the world — overcoming geographical and logistical limitations. It does not have to be the talent that must be present at the specific business operations, it could also be the one who manages the customer service and bookkeeping of the business. Remote jobs are also an opportunity for SMEs to try out which could also mean hiring diverse employees including people with disabilities and stay-at-home parents.

In addition to this, hiring freelancers and part-time workers allows businesses to increase productivity and reduce costs. For Malaysia to maintain its current growth trajectory while avoiding the “middle-income trap,” greater productivity, and competitiveness are key factors. This cost reduction in expenses is not limited to their salaries of course, but also includes savings on benefits and office space.

Challenges of hiring freelancers and part-time workers

The many benefits of the gig economy also come with great challenges — managing and integrating remote workers with existing teams. There are many great ways to address these challenges, and one of them is to utilise project management tools such as Asana or Trello. Establishing clear communication channels with the team and having a regularly scheduled check-in earlier in the week would also help just to hash things out and go through what everyone is doing and focusing on in that particular week or month.

Maintaining consistency and quality control is another critical challenge to this and freelancers in particular have various levels of commitment and work performance and styles — which can impact their quality of work. So, having implemented a standard procedure or set of rules in terms of managing the outcomes of the work is a great tool to have. This also means setting clear expectations and conducting regular performance reviews (a bi-monthly review is good too!) 

Best practices for Malaysian SMEs

To fully maximise these benefits of the gig economy, Malaysian SMEs must adopt these key practices including effective recruitment and onboarding, building strong working relationships, utilising digital tools, and setting clear expectations and contracts. Building strong working relationships is another vital practice. Maintaining regular communication through tools such as Slack or Microsoft Teams helps keep freelancers connected and engaged. Providing consistent feedback and recognition fosters a positive work environment and ensures that freelancers remain motivated and aligned with company goals.

Additionally, leveraging technology is key to managing tasks effectively. Project management tools like Asana and Trello facilitate organisation and tracking, enhancing transparency and workflow efficiency. Clear and detailed contracts outlining the scope of work, deadlines, and payment terms help prevent misunderstandings and ensure that expectations are met. By implementing these practices, SMEs can optimise their collaboration with freelancers and part-time workers, leading to increased productivity and successful project outcomes.

Conclusion

Malaysia’s gig economy is promised to continue stronger and resilient each year. Emerging trends also suggest that the gig economy will continue to increase and naturally integrate into traditional business models. With a recent study by the Malaysia Centre for the Fourth Industrial Revolution (4IR Centre) — 19 per cent of Malaysian gig workers plan to transition their career to long-term employment. This evidence suggests that the gig economy is here to stay! As digital platforms evolve and regulatory frameworks adapt, SMEs will likely see greater opportunities and challenges in managing a flexible workforce.

The rise of new digital tools and platforms will further facilitate the hiring and management of freelancers, offering more efficient ways to connect with and manage talent. By understanding these dynamics and implementing best practices, SMEs can effectively harness the benefits of the gig economy while mitigating potential risks. Staying adaptable and informed will be key to thriving in this evolving landscape.