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We’re Living in a Gig Economy: What is It and How Does it Affect the World?

The working environment has changed rapidly, creating what is now called the gig economy. What do you need to know about it?

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Generational gaps have never been more obvious than they are right now, exemplified by the rise of the gig economy.

While a couple of decades ago, a 9-5 job meant you were pretty much set for a lifetime of work, that is no longer a luxury afforded to the current job market.

Instead, most workers are juggling multiple jobs as freelancers, or ‘giggers’, many of them while still working in a full-time position.

What is the Gig Economy?

Have you met individuals who are contracted to work on a brand’s Facebook ads, while they make a website for a third company, and are simultaneously blogging for another brand?

That is the gig economy. And it goes beyond the digital sphere.

Many people with day jobs have a secondary (or tertiary) job as Uber drivers, or work in the food delivery sector. Others work on their own business development, or list their home on AirBnB.

Most giggers are doing these jobs on contract basis—working per project for a set fee. Giggers also often have a set payment per hour, which they invoice to companies on a weekly or monthly basis.

Once the project is completed, they move on to the next one, and then another.

For a few fortunate people, these short-term contracts become long-term projects, and even full-time jobs. But this outcome is rare—generally giggers find themselves taking on more projects.

Benefits of the Gig Economy

The gig economy has certain benefits for both companies and individuals.

Benefits for Businesses

Thanks to the gig economy, companies can enjoy greater flexibility in work schedules. Particularly in the service industry, this is a massive benefit.

Companies can use a diagram creator to track demands on employee times—on busy days, managers can call in more giggers, whereas on slow days, only a few people can be scheduled in.

This makes the workflow far more productive—no more employees standing around with nothing to do because only two customers came in instead of 25—thus, no loss in customer loyalty.

Additionally, the gig economy increases the pool of employees that a company has access to.

The traditional office format can be limiting in many ways—not only is the physical space restrictive, but companies can realistically only employ a certain number of employees without stretching the budget.

On the other hand, by tapping into the gig economy, companies can employ numerous employees without having to worry about overheads—many giggers take on remote work and don’t need an office.

Additionally, giggers often have a range of specialities—they can work on your outreach and lead nurturing, while fine-tuning Shopify apps to your business’ needs.

You would need to pay higher salaries for an in-house employee to do so many jobs, or employ more than one person, which would be another hit to your budget.

Benefits for Giggers

The gig economy has become a reliable form of income for many individuals—the job market is still a difficult area to break into for many, so people have taken matters into their own hands.

Which is why the gig economy is so common amongst Millennials and Gen Z—these groups have been hardest hit by the changes in economic standards, and the lack of viable jobs available.

Giggers have far more flexibility in terms of what they want to do and when. You don’t have a boss—you are your own boss.

You can set your own time frame for a project, work according to your own hours, and, if you are sought-after enough, set your own pay for using an email validation tool once a day.

The quality of projects giggers choose is completely up to them so they can work to their strengths.

The gig economy also gives freelancers the opportunity to learn more and diversify their skills, instead of being bound by the traditional needs of a 9-5 job.

Disadvantages of the Gig Economy

There are a lot of advantages to be had from the gig economy… if you are a business. However, for gig workers, the disadvantages often outweigh the pros.

Disadvantages for Businesses

There are actually very few disadvantages for businesses enlisting giggers. However, the constant turnover of freelance workers means there is no room to improve company culture and morale.

Additionally, with so many giggers coming and going, a certain amount of time and money has to be spent on training, if you want the most efficient results.

This is not a problem with employees—their training is at the start of their employment period, and then they get on with the work.

However, the cost of this training is generally offset by how much is saved on the benefits that companies aren’t required to offer to giggers.

Disadvantages for Giggers

The gig economy may offer flexibility to giggers but it comes at a price. The majority of companies do not offer giggers, contract workers, freelancers, or remote workers, any benefits.

This means no tax deductions at source, no pension plans, and no insurance. These can be massively expensive for giggers in the long run.

There is also no job security—giggers are constantly hustling, looking for their next project to get paid. If they don’t get a contract, they don’t get money.

Additionally, there have been several unfortunate incidents of companies not paying people for their work.

Freelancers have found themselves spending more time following up on invoices than actually working.

Giggers also have to constantly upscale their abilities, or expand their skills, if they are to be the most attractive freelancer out there for companies.

And all this leads to a great deal of stress for giggers, especially as there is very little chance of the gig work turning into a full-time job.

What is the Future of the Gig Economy?

All signs point to the gig economy continuing to grow, with many experts proclaiming that it will overtake regular full-time jobs.

This is good news for businesses, who are set to see huge savings. For giggers, however, this will mean a lifetime of unstable work, and very little opportunity to save for the future or investment plans.

However, new legislations are being brought in that encourage companies to give giggers some benefits.

This could be a better outcome for the gig economy, and will make giggers feel more secure in their role.

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