Gig Economy: Do you think it’s Future of Work

• 15 May 2020 | 1209 Views | By

With the coming in of technology there have been a lot of changes in the way our economy and society work. We all in today’s era people communicate, travel, bank, play, meet new people, and work differently. And the labor market isn’t made of steady or permanent jobs where the workers make a career inside a company and live with it forever anymore. In the digital age, the workforce is becoming more mobile and work can now be done from anywhere. As a result of this digitalization, job and location are being decoupled. 

A “gig economy” is a free and global market where companies and contractors can hire independent, short-term, and on-demand professionals that are both flexible and skill-based. In a gig economy setup, temporary and flexible jobs are the usual norm and the companies are more inclined toward hiring independent workers and freelancers instead of full-time employees. This has been resulting in cheaper and more efficient services for those willing to use them. In such times, those who don’t participate in using such technological services like the Internet, tend to be left behind by the profits of the gig economy. Cities having more developed services and are the most rooted in the gig economy. This kind of economy is also many times referred to as the “freelancer economy”.

What does gig mean in the gig economy?

The term “gig” is jargon for a job that persists for a specified period of time. Musicians typically use this word for a live performance or a recording session or any other musical engagements. A gig might have different meanings for different people, for example, for a freelancer a gig might be writing an article or designing a business card or creating any content, etc. There are wide ranges of positions that can be classified under the category of a gig. For example, part-time professors are contracted employees as opposed to tenured or tenure-track professors. Colleges and universities can minimize their costs and match professors to their academic needs by engaging more adjunct and part-time professors.

Check out Loans for Part Time Employed Workers.

Is Uber a Gig Economy?

Uber is one of the pioneer examples of a gig economy. Since its core ride-hailing app relies on millions of drivers who are classified as contractors and not employees. The Uber drivers and the company have a contractual agreement between them; these uber drivers are not permanent employees of Uber Company. For an Uber driver, a gig means picking up a client from their specified location and taking them to wherever they want to be.

What are the examples of the Gig Economy?

The gig economy has been present for a long time, even if people don’t recognize it. Even though it’s nothing new, an Internet connection is all that’s required to buy or sell transactions or to agree on making a business deal. All this is made accessible due to the cloud-based platforms that bring independent workers and employers together. There are many companies operating in a gig economy, some of the prominent ones include:

Uber, Grab, Lyft, Ola, DiDi: Online transportation network companies.

Find out How Does Uber Earn.

Airbnb: Online accommodation rental platform.

Fiverr, Freelancer, Upwork: Online marketplace for freelancers.

Foodpanda, Swiggy, Zomato: Online food delivery service.

What is a Gig person?

A “gig worker” is referred to a person who is hired temporarily for the job to be performed. The term covers a number of worker positions like the freelancer, on-call workers, temporary worker, and contract worker. The gig workers enter into formal agreements with the on-demand companies to provide services to the company’s clients. Gig workers are said to have higher levels of flexibility, autonomy, task variety, and complexity. Men and women both join equally in the gig economy, but there are differences in what types of gigs they take on. Men are more probable to take up labor gigs while women, on the contrary, are more likely to work for direct marketing gigs or sell goods online. 

Why is the Gig Economy called the Gig Economy?

The word ‘gig’ in the gig economy symbolizes a small part of work. However, some other meanings can also be associated with a gig like it also means a brief agreement or relationship between the employee and the individual or organization that pays them. The gig economy derives its name from each piece of work being akin to an individual gig. It has previously also been called the “sharing economy”.

Who is part of the Gig Economy?

The components of this gen-next economy can be divided into 3 major components:

What are the pros and cons of the gig economy?

Like every other thing, a gig economy also has two sides to the coin, the positive and the negative. The positives being:

Flexibility

The most obvious benefit of working in a gig economy is flexibility. A gig worker is at the liberty to choose when, where, and how do they work. They have a choice to select the clientele too. Moreover, according to a study, people who do independent work by choice and have it as their primary source of income report greater satisfaction with their work than traditional workers. Additionally, for employers, they have access to skilled workforce as and when needed to them the most. 

Cost-effective

Organizations can reduce their costs with both time and money. Companies can access the resources as and when they need it. They need not employ a fixed employee for tasks that need to be accomplished once in a blue moon. Moreover, they don’t even need to provide all the privileges as of a fixed employee like paid vacations or health insurance etc. Organizations also save up on their infrastructural costs when hiring a gig worker.

Variety

A gig economy worker may find a wide variety of jobs to perform instead of similar, monotonous tasks to be done each day. Every project or gig may have different elements that make the work more interesting to perform.

The cons, or negatives include:

Inconsistent source of income

An inherent risk with such an economy is inconsistent income. On some days a gig worker might have a lot of work or tasks to be performed which they are unable to complete while on other days there may be no work at all. Also, there is an ever-present possibility of the employer no paying or going out of business.

Legislation and regulations

There are many legal considerations around working in a gig economy. Since contract gig workers are not legally classified as employees, thus many laws do not apply to them and in a situation of a legal battle; they might be at higher risks.

Why is the Gig Economy bad?

Through exploring the modalities of the gig economy, it is evident that there are certain issues. Unlike work based upon permanent employment relations gig work functions within an open employment relationship that often results in problems to the worker. Under this arrangement, workers fear the lack of security, benefits, and stability. The risk within this arrangement is almost fully transferred to the employee. The gig economy has certain advantages, but most of those advantages are favoring the large corporations.

This economy is an environment built on confusion, indecision, and ambiguous control. As this economy expands, it is believed that more and more intermediaries will appear, thus more people will look for gigs, and this, in turn, will result in a rise in economic inequality. The truth is that the overpowering negatives of these employment structures seem to overshadow the positives in many cases. The gig economy can be a world full of opportunity or a world full of potential hardships.

What does the future hold?

The trend toward a gig economy has begun. Digitalization has also contributed directly to its favor. The gig economies can assist workers, businesses, and consumers by making work more adaptable to the needs of the moment and demand for flexible lifestyles. The employers can also select the best individuals for specific projects from a larger pool than what’s available in any given area. On another note, the gig economy can have its downsides due to the erosion of traditional economic relationships between workers, businesses, and clients. Today, the gig economy functions chiefly through internet-based platforms created to connect people looking for work arrangements, with the people who need a temporary workforce.

Many reasons make it reasonable to foresee that the gig economy and independent work will grow further in the nearing future. As innovative and new technologies continue to emerge these enable workforce collaboration and make working anywhere, anytime possible on a global scale. Let us anticipate seeing a lot more people experiencing the pleasures and pains of the gig economy. If you want to test a new job or add some extra income to your every month income, a gig job may be the right choice for you. It would all boil down to what skills the gig workers bring to the table to see what the future beholds for the gig economy.