There’s a new kid on the block.
You may have heard the name mentioned here and there. But you never really paid much attention to it.
Recently, however, you’re hearing the name more and more.
The last few months it’s been addressed in business meetings and lunches. You have family sending you annoying articles and posts, your friends want to get involved too. All the uni-graduates are apparently already his best friend.
Seemingly overnight – the new kid on the block isn’t just the new kid anymore… but emerging as one of the most popular, and everyone is interested in being his friend.
You may have finally decided to go see what all the fuss is about – this may be your first introduction or you may be here in consideration of getting more involved; so let’s get on with it.
Who is the new kid on the block? Enter; the gig economy.
What is the gig economy?
The gig economy is based on flexible and freelance work, commonly undertaken on a short term contract rather than a long term stint of employment. The word ‘gig’ refers to musicians and indicates a one-off specific job. The key characteristics are:
- Free agents/self-employed.
- Paid for limited contracts.
- Zero hour contracts.
- Freedom to choose jobs taken.
It’s a diverse landscape which ties uber drivers and food delivery to tech programming and consultant accounting.
The rising prominence and sophistication of digitisation technology and the increasing interconnectivity of the internet allow for all kinds of possibilities.
It is one of the fastest-growing markets both worldwide and in Australia. In 2019 it was recorded that 7% of working Australian’s were already finding work in this emerging industry. This number, however, is primed to jump even higher in the new decade as a study conducted by Deloitte recorded that over 50% of Millenials and 67% of Gen Z Australians are interested and considering joining the gig economy – either in place of a full-time job or to supplement their current income.
The statistics depict a large generational shift away from the traditional full-time form of employment. It promises a future of freelancing and independent work, a liberation from the restraining normalities in an individual’s 9-to-5 they attend every week for 30+ years.
The emergence of the gig economy is a polarizing development as it offers extensive economic and social benefits to both employees and employers, yet poses a significant risk in its current relatively unregulated and unprotected nature.
It poses the same question that everyone will consider in the coming years –
Is it worth the risk transitioning into the gig economy?
What are the pros of joining the gig economy?
When it comes to the benefits offered by working within the gig economy – there is a wealth of convincing and exciting social and economic upsides presented to both employee and employer.
Flexibility
Gig workers have the power to negotiate and determine the hours and workload that they take on. As a gig worker, you aren’t owned by a single employer and consequently required to be on task and working for them every week all year. This flexibility allows you as a gig worker to control the amount of work you do and grants you the freedom to shape your life and interests around that. Gig workers are paid based on their ability to deliver outcomes, but how they get there is completely up to them.
Improving variety and quality of skills
Becoming a gig worker means over the course of your career, you will likely work for various employers demanding a different approach for various different kinds of tasks. This variety and sense of ‘no job is the same’ will only benefit you as it will provide extensive opportunities to expand and improve your skills in ways not possible in traditional employment.
This will in turn make you more desirable to employ and with greater expertise and experience – you can earn more for your time.
Independence
Entering the gig economy and offering your own skills to the market gives you a sense of ownership over your abilities. This independence offers multiple benefits that are hard to access if employed on a full-time basis.
Essentially you are presenting your own business, and this means you can accept the contracts you want and work on the projects that interest you. You are able to choose who you work with and the partnerships you make. You can pursue the opportunities that appeal to you and jump into new bright industries to get ahead of the curve.
Engagement
Gig work has the potential to be more meaningful and engaging. An individual effectively engaged in their work has a significantly positive impact on their performance and motivation. The essence of building your own personal brand through your work has a heightening effect on productivity. This greater level of engagement has only a positive influence on all aspects of working in the gig economy.
Financial upsides
Whether you join the gig economy as a side hustle or make it your full-time thing; there are plenty of opportunities to make bank and earn additional income. By combining all the reasons mentioned above – there is a resulting effect to greater employee productivity and engagement, which is directly correlated with earning a higher income. The wider set of skills a gig worker develops and the heightened problem-solving having arisen from working on different projects allows you to charge more for your expertise.
In your independence and freedom, you are also in a prime position to react quickly to market changes and take advantage of new, potentially highly lucrative opportunities.
What are the cons of joining the gig economy?
However, opposed to the many benefits of entering the gig economy there are also key downsides which can make it a daunting and potentially dangerous endeavour. Working independently means you are often cut off from traditional support services and securities that are provided by full-time employers.
No employment benefits
For most work opportunities inside the gig economy, there is a noticeable absence of additional benefits and securities provided by your employer. Because you aren’t a full-time employee, there are very limited laws that outline and regulate how an employer must treat you during and following your contract. Sometimes, the company’s will offer benefits to long term contractors but this is rare. For almost all gig workers – effective and proactive planning for retirement and private insurance should be essential.
There is no steady paycheque coming in and the lack of sick leave can leave you in a very vulnerable position should anything go wrong.
Personal expenses
Gig workers need to be responsible for all their own work expenses i.e. phone, computer, transport, etc. Balancing these costs can be difficult when one is often very busy as is. On top of all this, gig workers are responsible for organising independent superannuation contributions, paying their own taxes, and closely monitoring their timesheets and invoicing. Managing of all these responsibilities can feel like an entire job of its own.
Solidarity
It can be easy for a portion of gig workers to find the independent, separated life of the gig economy an issue. Freelance workers aren’t often required to go into an office and thus they miss out on the important social elements that are provided there. The lack of a daily lunch with coworkers or special corporate events means that gig economy workers may find they spend their day alone and with limited interaction with others. This can cause a sense of isolation from other people and generate a feeling of being distanced or left out.
Stress
The insecure and hard to predict nature of the gig economy can be a significant source of stress for workers. Gig economy workers sometimes face unexpected changes in their jobs, from being let go, to a change in their salary. There is also stress in being removed from other employees and if there are questions or issues with a project, that can be difficult to communicate.
Will the gig economy prevail?
It’s hard to tell exactly what the future has in store for the gig economy, however the facts suggest it has a prominent role to play in the future of business and the careers of many.
There are a wealth of enticing upsides to entering the gig economy that promise both physical and financial freedom – establishing it as a possibility that would make it silly to be left unattempted and unconsidered.
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