What is the ‘Gig Economy’?

For the most part, a lot of people grow up dreaming of landing office jobs in mega-corporations or just any sort of job that offers a stable and consistent income.

That trend has slowly been changing, however, since the way the world views jobs and the workforce, in general, has changed massively over the past few years, a change that can mainly be attributed to innovations in technology and communications.

The new trend that has rapidly gained so much momentum in the employment sector is the focus on self-employment rather than the aforementioned ‘fixed office jobs’. The flexibility offered by this type of way to make ends meet is what has made it so popular in today’s world which in turn has led to the creation of what is termed as the ‘gig economy’.

Defining the Gig Economy

The gig economy is essentially a system in the job market whereby workers get to work for organizations or any employer really but for a specified and usually short period of time. The nature of the brevity of these working periods and contracts is what resulted in this job market being referred to as the ‘gig economy’. The word ‘gig’ also on its own is a slang word used to refer to a job or work that lasts a specified duration.

Factors that led to the emergence of the Gig Economy

Objectively speaking, the gig economy has been around for quite some time. The difference is now the scale of the uptake is more than ‘quite big’.

For instance, several studies in the USA alone have shown that by the year 2022, approximately 44% of the entire labor market will be based in the gig economy. Considering what numbers that figure represents shows just how astounding this phenomenon is.

Below we’ll briefly take a look at some of the factors that have led to the growth of the gig economy in today’s world:

Unemployment/Underemployment

The gig economy really started to pick up after the financial crisis back in 2007-2008. Many jobs were lost and a lot of people lost trust in getting what was before termed as ‘stable income office jobs’.

Industries and other large scale organizations that before offered employment now have limited job spaces and factoring in the number of graduates churned out every year, there isn’t really a sustainable job market to look forward to like before. This case of unemployment/underemployment is one of the biggest reasons for the rise of the gig economy.

Technology

It’s little surprise that this is the first factor on this list. Technology has come a pretty long way over the ways, sizing down the entire world into what is termed as a ‘global village’ given how easy communication is. Technology in this sense, however, impacts this topic in several ways:

• Digitization of many services has led to the cutting down of the need for a human labor workforce.
• Similarly, the invention and creation of machines and robots have also reduced the need for human labor in a lot of work environments.
• The internet easily connects the entire world and it’s easy to work on many projects remotely, even if they’re listed form a country other than your own.

Flexibility

Working remotely means one can even work from home. The gig economy also means that you get to choose your working hours/days/weeks/months, therefore, allowing you some much-desired flexibility. This flexibility affords many a work-life balance otherwise hard to achieve in normal jobs.

Organizations

• Trying to cut Down Risks: Since by hiring a third party to do the work for them, most of the risk involved with delivering is passed on to the hired party.
• Trying to cut Down Costs: By hiring personnel on short-term contracts, they can get the job or services done when needed rather than having them on board fulltime which would demand a salary. Also, since some tasks can be accomplished for them remotely, they cut down costs on things like stationery and office space.

Merits offered by the Gig Economy

Let’s now briefly highlight some advantages presented by the gig economy for those who opt into it:

1. Flexibility: As stated earlier, the gig economy does well to offer flexibility in terms of working hours, thus enhancing your work-life balance.
2. Work Remotely: A lot of the jobs involved in the gig economy like freelancing, for instance, can be done remotely, meaning they can be accomplished even from the comfort of your home.
3. Project/Job Selection: The gig economy affords you a choice in what you can or want to work on unlike in the usual salaried jobs where you do whatever you’re tasked with.
4. Opportunity: The gig economy provides an opportunity for a large number of the populace unable to secure a stable job. It also allows even salaried persons to have another channel of income other than their main job in what is known as the ‘hustle’ culture.

Criticisms of the Gig Economy

As revolutionary as it is, the gig economy still has its shortcomings. A few of them are highlighted below:

1. No Job Security: Considering the volatile nature of the gig economy, securing a contract with a particular employer doesn’t necessarily mean you’ll get hired the next time they need the same job done.
2. Limited Improvement Opportunities: This point mainly touches on those who rely on it full time. Since the money earned goes into life’s expenses and what not, many may be left with enough income to fund courses or activities to broaden their scope in the market.
3. Limited Benefits: Unlike when working in organizations, there’s no bonuses, premiums, insurance covers and other such benefits.

Conclusion

In an age where there are increasingly limited opportunities for jobs and money making ventures, the gig economy is a sure way to help alleviate the situation. In third world countries,  especially where unemployment and underemployment rates are sky high, this is a much welcome step forward.

As studies show, however, the growth of the economy will be so largely dependent on this gig economy that it could end up replacing the normal 9-5 jobs… a point that wouldn’t be so bad if it came to actualization since everyone could end up having an opportunity to get a piece of the pie and live life comfortably.