February 27, 2024

The Rise of the Gig Economy – Opportunities and Challenges

Millions of workers of all ages are turning to gig work as an increasingly attractive career option, yet does this new way of working provide the freedom and flexibility sought by so many?

Additionally, gig companies are taking aggressive steps to prevent unions from forming. Uber recently took this a step further by deactivating — that is firing — drivers who lead efforts to form unions.

Benefits to Employers

As businesses expand, they can reduce expenses by cutting on-site employees and outsourcing expensive office equipment and software systems, such as those needed to run expensive office systems or provide health insurance benefits or year-end bonuses. They can also save on benefits costs like health insurance premiums or MPF contributions that they would otherwise need to provide their employees.

Workers with gig jobs enjoy flexible schedules and the possibility of earning extra income on top of their regular wages. Furthermore, gig workers do not depend on internal job markets where promotions depend upon how well their current supervisor likes them.

Gig workers range from millennials exploring various occupations before choosing one to Baby Boomers earning extra income as they approach retirement age. Common gig jobs include computer coding from home, driver for food delivery apps who transport meals or goods around in their vehicles or nurses filling in for long-term clients on contract basis – ideal jobs for workers who value independence without daily staff meetings, progress reviews or water cooler gossip sessions interrupting them!

Benefits to Workers

The gig economy can be an eye-opener, yet its flexibility can put immense strain on personal lives. Workers may not be able to sleep or eat on a consistent schedule and are constantly on the hunt for opportunities – depending on how they’re classified they may not receive certain social insurance benefits such as unemployment and workers’ compensation that full-time employees are eligible for.

American workers who have earned money through gig platforms generally find the flexibility of these jobs highly satisfying, with 49% of gig platform workers citing being able to set their own hours as one major reason they took these roles. Unfortunately, however, many feel left behind and isolated in the workplace; furthermore technology often only furthers existing inequities rather than disrupting them – this phenomenon being especially noticeable among low-income workers.

Challenges to Employers

Due to cutting-edge technology, gig economy companies can seamlessly match service workers with clients without creating employment relationships, significantly lowering operating costs by forgoing benefits like healthcare coverage or worker’s comp coverage for their workers.

Flexibility is appealing to workers as well. People who earn money through gig platform jobs such as driving or food delivery report having different motivations for doing them – from supplementing gaps in income to being their own boss and more. Many also supplement traditional forms of employment with gig work.

Still, most current or recent gig workers report they rely on gig work for financial reasons and therefore more likely to consider themselves employees than those who do not rely on this kind of work. Opinions regarding how drivers should be classified vary based on political affiliation; those leaning Democratic are more likely to view drivers as employees than their GOP counterparts.

Challenges to Workers

Though the gig economy can provide an alternative form of employment for job-hunting or non-full-time workers who prefer not to commit full time, it can also become an employment dead-end. Many gig workers report economic insecurity due to subminimum wages; others must choose among different gig-economy platforms offering less desirable pay and conditions than another platform.

Modern gig workers don’t just include freelance writers, musicians and graphic artists – they also include truck drivers, IT specialists, nurses and other highly-skilled professionals who make gig work part of their career strategies.

People who view gig work as essential or important are more likely to cite covering gaps or changes in income (61% vs 38%), wanting to be their own boss (44% vs 22%) and not having other jobs available (34% vs 21%) as major motivations for taking this type of work. Unfortunately, gig workers do not enjoy the same legal protections as traditional employees.