Balancing Flexibility and Stability as SDGs: Gig Economy Adoption, Flexible Recruitment Policies, and Employee Performance in North Sumatra’s Public Sector

Abstract

Purpose: This study aims to develop a framework for understanding the impact of gig economy adoption and flexible recruitment policies on the performance of contractual government employees (PPPK) in the regional government of North Sumatra, with work engagement as a mediating variable. Design/methodology/approach: Data were collected from 320 PPPK employees through questionnaires. Statistical analyses, including classical assumption tests and path analysis, were conducted using SPSS to examine the direct and indirect effects of gig economy adoption and flexible recruitment policies on employee performance, mediated by work engagement. Findings: The results indicate that both gig economy adoption and flexible recruitment policies significantly and positively impact employee performance. Furthermore, work engagement serves as a significant mediating variable, enhancing the relationship between these independent variables and employee performance. This suggests that creating a balance between flexibility and stability in employment can improve PPPK performance. Research limitations/implications: The study focuses on PPPK employees in the North Sumatra regional government, including teachers, healthcare workers, and technical staff. Future research could expand the scope to include other types of employees and regions, as well as consider additional mediating variables such as job satisfaction and organizational support. Originality/value: Unlike previous studies that often address either gig economy or recruitment policies in isolation, this research integrates both elements and examines their combined effects on employee performance within a governmental context. The study provides a comprehensive framework for policymakers to enhance employee performance by balancing flexibility and stability in the workforce.