Muhammad Osman Khan, country manager, UAE, for Elance-oDesk, explains how the online staffing platform is changing the face of hiring in the region
How strong is the online staffing market in the UAE and across MENA?
The global contingent labour market is $2 trillion, and the staffing market within that is $422 billion. Staffing Industry Analysts forecasts the online staffing market to be up to $46 billion by 2020. With regards to the MENA region, it’s early days to give an estimate of that share, but as businesses realise the benefits of online work it is increasingly becoming substantial.
When it comes to Elance-oDesk, the UAE ranks fifth globally in terms of its online talent hiring spend, with companies spending AED89.9 million ($24.5 million) in 2014 on our workplaces.
We’ve seen an increase in both client registrations and job posts by more than 15 percent in 2014 and I believe this is only the start. Cumulatively we have over 35,000 clients registered with 75 percent of their spend on technology, which clearly highlights the talent gap they are facing. As for freelancers, we have over 70,000 registered, with sales and marketing seeing a growth of 130 percent in 2014.
What are the main hurdles that have had to be overcome in this region?
Just like e-commerce reinvented how people shop, online staffing is disrupting how companies hire.
It’s a massive transition from the traditional approach to work in the region, with early adopters currently using the platforms as a major competitive advantage. Like with so many internet-driven markets, resistance to change is our main challenge, which can only be overcome by education and awareness of online work. Location doesn’t matter anymore, only talent does; now that’s unheard of in the region, where working in an office for a set number of hours behind a desk is the norm.
What are the main benefits for the employees and employers?
There are many benefits of online work for businesses, but the most profound advantage is the boundaryless access it provides to the very best talent across a plethora of in-demand skills.
Companies can quickly find team members with a particular qualification, specialisation or prior experience that are missing in the company or regionally unavailable, too expensive or not available in the desired time period.
Companies are able to expand the existing organisation to a hybrid network of globally distributed experts as quickly and efficiently as possible.
Further to this, in the traditional labour market it can take months to fill a job, yet on Elance-oDesk the average time to hire a skilled professional is three days, with 25 percent of all jobs filled within 24 hours. Starting a project within days, not weeks, also gives companies a clear competitive advantage. Often they are also only temporary projects, making it difficult for companies to justify the expenses and delays involved with obtained visas when hiring for a permanent position.
Freelancers on the other hand can choose to work when they want, from where they choose, on projects that interest them. They also enjoy increased career empowerment and better control of their income stream: The reality is that working for one employer is a thing of the past. The average job duration today is around four years, and for Millennials it’s more like half of that.
The professionals who will be most successful in the future are those who take charge of their own careers and treat building skills as if they’re building a diversified portfolio. Working online means freelancers are driven to evolve their their skill sets to remain competitive, and nurture their online reputation. Finally, they can access millions of job opportunities that would otherwise not have been a possibility; freelancers are no longer limited to jobs located within commuting distance.
How does this type of platform help to encourage and develop the entrepreneurial ecosystem? How does it help boost the creative market and encourage local talent?
We have several success stories from the UAE, with start-ups developing hybrid teams in order to scale and grow using Elance-oDesk.
If we put this into context, start-ups in early stages are now able to hire resources which they would not have able to find or afford without our workplaces. As they grow, we see them increasingly hiring on the ground, whilst maintaining a distributed team in the cloud.
For start-ups we are not only addressing a talent shortage, but also cost effectiveness, resulting in start-ups having to make fewer choices between the types of resources they can bring on board.
Since elance.com and odesk.com are free markets, talent from all over the world can register and apply for jobs. If you have a skill, you can find a job for it, however, you are competing in a talent pool compromising of 180-plus countries. Increasing competition means freelancers have to continuously upgrade their skills and produce quality work to keep succeeding. With 2.8 million jobs posted globally in 2014, there are enough opportunities for talented professionals.
On the local front, we’ve seen freelancers from the UAE growing in sales and marketing, along with finance. Both categories have a good presence of talent in the country.
What is the current state of the UAE’s creative community? What needs to change in order for it to blossom?
There is great work already being done to shape the ecosystem by the different stakeholders, which also includes reducing the barriers to entry.
What we need now is entrepreneurs being fearless with a vision to innovate for consumer demands globally. One of the reasons for this to happen will be access to the right talent at the right time, and that’s where we step in.
There is no doubt online workers will play a major role in the evolution; the future of work is a hybrid workforce, where work is no longer a place. And with each passing day, this is becoming a reality.
How many people have signed up to Elance-oDesk in the region?
The MENA region is one of our fastest growing regions. Twelve thousand new UAE companies registered in 2014, with client registrations in the UAE increasing 15 percent to 20 percent every year.
A total of 22,000 new UAE jobs were posted on last year, representing a 16 percent increase in demand for freelance talent since 2013, and significant increase in online hiring in the region.
What are the main reasons companies have given for using the platform?
The growing appetite for hiring online freelancers in the UAE boils down to a talent crunch. The most hired-for category was Technology, counting for 74 percent of businesses spend.
With 60 percent of the UAE economy made up of SMEs and with a rapidly expanding pool of entrepreneurs, tech and start-up companies in region, a growing number of businesses in the UAE have already started to benefit immensely from the rapid access to global talent garnered by the platform (average time to hire is just three days and 25 percent of jobs fill within 24 hours).
There are also no barriers to entry, which means businesses can register and source the talent on the workplaces for free.
Please can you discuss the purpose and findings of the Impact Report.
Elance-oDesk’s 2014 Annual Impact Report includes new research on the work fulfillment of online freelancers and showcases how businesses of all sizes around the world - from Singapore to Sydney to Seattle - collaborate with teams of freelancers. It also demonstrates how the ability of these freelancers and businesses to work together via the Internet (“online work”) is providing access to job opportunities for many who may otherwise struggle to earn income.
The report includes findings from a new study on work fulfillment which shows that freelancers on Elance.com and oDesk.com say they are more fulfilled than other professionals due to factor like creative or strategic thinking, opportunities to challenge oneself, high relative income, work/life balance, and control over one’s own career path.
It also brings to life the growing economic impact of the Elance-oDest community:
• Freelancers are earning more than $1 billion annually.
• Businesses are posting 2.7 million jobs and conducting nearly 100 million searches for over 2,700 skills.
• The Elance-oDesk community has expanded to 180 countries
What do the coming months and years hold for EO? How do you envisage the platform developing?
Our vision is to build an online workplace for the world and, in doing so, reimagine work.
We are targeting an enormous opportunity - $2 trillion contingent labour and $422 billion global staffing within that, and we see the opportunity for tens of billions of dollars of work to be done online in the future.
How did Elance-oDesk come into being, and how did it find its way to the Middle East?
Elance was first launched in 1999, its name inspired by a 1998 Harvard Business Review article titled “The Dawn of the E-Lance Economy”.
It was initially developed as a technology for supporting virtual work. Two years later, Elance introduced a vendor management system for contractors and third-party services used by large enterprises. In 2006 Elance sold its enterprise software division and developed instead its current web-based platform for online, contingent work.
oDesk was founded by Odysseas Tsatalos and Stratis Karamanlakis. The two friends created a new technology platform (an online workplace) to allow distributed teams to work together and help instil trust in work happening via the Internet. oDesk, along with its network of freelancers (spanning any type of work that can be done via the Internet) launched in 2003.
Elance and oDesk merged in 2014, forming the leading online workplace, and working together, we have the ability to reimagine work on a bigger scale, to build an online workplace for the world. We’ve always been here in the Middle East being an online platform, however, with the rise of tech savvy SMEs who understand the competitive advantage it provides, it’s just gone from strength to strength.
With UAE our 5th highest country in terms of online talent hiring spend, we made the decision to have a presence on the ground last year. We made this decision based on the sheer potential of businesses in the region to scale and accelerate growth through our workplaces. With a majority young population, the region has the ability to become a powerhouse of innovation and solving problems of the future. Eventually it comes down to opportunities, and that’s what we are providing to both businesses and freelancers.
Can you explain how online work happens through your platforms?
Elance-oDesk is the global leader in online work. Through our sites elance.com and odesk.com we help independent professionals and businesses to find each other and work via the Internet. Our vision is to build an online workplace for the world and in doing so reimagine work.
Our sites have three main areas of functionality:
We call this making a “match”. All relationships starts with a business posting a job or searching for a freelancer.
When the business has posted their job, freelancers with the necessary skill set submit a proposal for the job explaining why they are the best fit and indicating which price they would charge.
The client can then interview the freelancer, review the freelancer’s work history on their online profile and negotiate on the terms. Once the client has identified the freelancer they want to work with, they award the job.
The client and freelancer start to collaborate, exchange messages, share files and track the progress of the project - all in one place on the site.
Once the job is completed, the client approves the work and pays the freelancer through our global payment system.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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