This makes perfect economic sense. You're a business, if things go poorly you scale down cost-free, if they go better, scale up at slightly higher cost than fixed, but the flex is more than worth it. After all, with this you protect margins in all scenarios. Perfect no? In this sense, it mirrors cloud compute instances. Lower capital investment, granular scalability (in this case of human resource rather than compute resource).
Except that it reminds me of an old adage of finance: you cannot eliminate risk - you can only transfer it. This is a classic example of risk transferral: from capital to labour. It makes tons of sense for a business. It makes much less sense for the employees, who, atomised commodities, have no bargaining power. This is, by extension, a bad idea for society, if you accept that groupings of individuals, including those defined by today's "corporations" exist precisely to reduce risk for each individual. That is the implicit exchange between employee and employer. I will provide you with the opportunity to profit from my labour; you will provide me with security. This breaks that contract.
To those who will argue that it is good for aggregate growth, I say, trickle down is not happening. Eliminate the trickle down argument and you're left with a bad proposition.//