With around 50% of the US workforce tipped to be employed in the gig economy by 2020 *, what IS attracting all those people to this new way of working?
And why is there a plethora of freelancing “platforms” being launched around the world?
There must be something pretty special happening, as it almost sounds like a return to the good ole “gold rush” days!
So if you’ve been under a rock and not heard about it, the “gig economy” is a rapidly emerging trend in the labour market worldwide, where people are moving away from being an employee at a regular full-time job, and prefer instead to carry out several short-term jobs and/or freelancing.
The Internet has enabled many of these people to be “self-employed” and communicate more easily with those who may need their “services”, either through the big online freelancing platforms or by setting up their own website.
There are quite a few reasons why people might want to become a “gigger”.
People are driven by a range of motivations, which vary depending on the nature of the work they do.
For example, part-time or casual giggers may choose that type of work because they:
- CAN’T FIND full-time employment in their area
- want to SUPPLEMENT their main wage with extra income from part-time gigs (even though they may be able to live comfortably without it)
- like the FLEXIBILITY to work more to earn more if they need to
- want more SOCIAL contact and interaction in their lives
Full-timers, however, might want to get into the gig business because:
- they have some sort of CONTROL over their schedule and work when they need to
- of the freedom to work WHERE you feel comfortable and/or most productive
- you are creating your own opportunities and being your OWN BOSS
- more VARIETY of work is possible
- some are able to ACCOMPLISH MORE in this environment
- it creates a more appealing WORK-LIFE BALANCE due to the flexibility
- they dream of “FREEDOM” and the lifestyle options it brings
- they can become a “digital nomad” and TRAVEL the world, work from laptops and coffee shops
- they want to “ESCAPE” the 9-5 rat race and the daily commute
These are some of the benefits that I personally see, as a self-employed, digital nomad, with over 22 years experience in the online world. But I deliberately make it easier for me to live that “lifestyle” as I DO choose to live simply, and am very frugal with my expenditure.
Remember, as a self-employed person,
“Every dollar you don’t spend, is a dollar fifty you don’t have to earn!”
Employers might wish to use the on-demand economy because (and more ideas here):
- they can’t find people with the skills needed LOCALLY
- they can acquire HIGHLY SKILLED labour on a project by project basis
- they DON’T have to take on (another) full-time worker – and all the responsibilities etc that go with that
- it’s more AFFORDABLE to take on a contractor so you save money in the short term
- they can TEST NEW IDEAS quickly and cheaply
But in any country with a long history of Unions fighting for improvements to working conditions and pay, they see all sorts of “problems” with the whole concept. In fact, right now, there are landmark cases before the courts in countries across the globe!
Because gig workers are classed as “contractors” and as such they don’t have all the normal rights of employees, such as pensions, sick days, holiday pay or parental leave.
Gig workers are paid per job, and there is no financial security. There’s no guarantee you will get enough “gigs” during the working day to obtain what is a “reasonable” wage or decent hourly rate for the time put in. There’s no guarantee that your job will still be available tomorrow.
And there’s no clear “career progression” pathway or “loyalty” rewards in gig work. Workers who have been doing the job for 4 years will most often get the same rates as people who have just started.
Many gig workers have to make themselves available at all hours, often on short notice, just to earn enough to live. And since there is (currently) no limit on a number of hours you could work each day, then this (and other) workplace safety issues are not being monitored.
But what sort of life is it when you’re stressed all the time, and constantly “working” when you should be having fun with friends and family?
And don’t try to get a loan for a car or house, because your insecure and irregular income could make that difficult to get, and to possibly meet ongoing repayments.
But the immediate problem is the low pay rates associated with many of the gig opportunities, especially when you face increased competition on an international platform with people from overseas countries who have a much lower cost of living than your own. While they may be able to afford to push prices for freelance jobs down, you certainly can’t!
And being “self-employed” also means you’ve got all those regular issues to deal with on a day-to-day basis such as work expenses, taxation, invoicing, marketing, etc.
However, for all the platforms that are providing the gig “services”, they seem to be booming and doing very well from it all!
Sure, they may have invested a lot of capital to set things up, but you have to wonder how much real “risk” they are taking, compared to all the workers… sorry – “contractors”, using their platform?
What Of The Future?
The rapid growth of communications technology is certainly opening up new work opportunities and quickly changing many of the old ways of working!
The Internet has enabled people from all over the planet to take part, and compete in, the “global” business.
Things are certainly changing, and the worker who does not recognise that change, and who does not take the appropriate actions, will be left behind. In that, there is little doubt!
The actions you need to take will depend on what you really want for your career and your life in general, and whether you are prepared to keep learning all the new skills that might provide that for you.
One thing is certain… “talent” is a certain winner in this new world of work!
I’m just not sure whether it’s all that great for those who aren’t so talented or self-motivated and who are too reliant on using the gig platforms for a “living”.
Quick Question For You…
WHO made most of the money back in the gold rush days?
Well, it most certainly was NOT the miners. Many of the miners went broke in pursuing their chase for gold.
But not those who sold them the shovels and the picks! Those people – the people who sold them the tools – are the ones who really cleaned up!
The same thing is happening right now, so be cautious with what you do.
I’m not trying to turn you away from doing this type of work… I just want to make sure that you are very aware of the many potential pitfalls before you make any life-changing decisions 🙂