The gig economy refers to workers that depend on freelance deals and rarity jobs, contrasting to a fixed salary arrangement with a single company. This method of working is used by many musicians and artists as well as mechanics, contractors, taxi drivers, and more.
Despite being comparatively small, the gig economy is an ever-growing way of making money. In the USA under 1% of the US working population (roughly 1.6 million) are gig economy workers. The gig economy is gradually becoming a source of revenue for more people around the world with more companies utilizing this model as their chief functioning approach.
Some gigs might as well be as short as a five-minute survey while others could be a month or year-long scheme; In any case, workers who receive their income through the gig economy should have a subsequent project once they are done with the existing one.
Since businesses have a new-built facility of being able to promptly contract with experts for individual projects with no overhead costs like office space, instructing, and benefits, the gig economy is generally a win-win proposal for employers. Nevertheless, for freelancing gig workers, it can be a fusion of pros and cons.
Advantages of a Gig Economy
Many freelance workers in the gig economy notice that their position permits them great flexibility. There are numerous alternatives for gig economy workers like- working for desired hours, working in the desired space, and so on.
Typically, a task will be assigned to a worker with a deadline; the process they follow in the meantime is up to them and their comfort. Generally, workers are able to work at their own suitable hours and on days that are appropriate for them. The preference might differ individually.
The gig economy offers the flexibility to work from a remote office or a home. This might often catch the attention of people seeking to work around family schedules.
2. Alternative Career Choice
After losing her government job, Washington D.C inhabitant Charlie Heck turned to the gig economy for auxiliary income. Rather than routing back to work, she began pet-sitting and walking dogs for upscale clients in Washington D.C throughout her downtime.
Once she set up clients for her multimedia freelancing gig, it led to a full-scale small business. She seemed to call it quite an act of balance in the beginning but gradually it all began to work out well for her.
70% of employers using these workers stated that they were significant to the company’s profitability and competence on the whole, which is evidently an advantage of profitability for businesses. 10% of these judgment makers informed that gig economy workers made up 90% of their workforce or extra, whilst over 41% reported that this sort of workers made up no less than a quarter of the business.
4. Greater Independence
Most of the contract or gig economy workers are acquainted with greater independence while performing and completing their work. They aren’t obliged to work with a predetermined timetable not considering their individual comfort in work and time.
They do not have to rush for office and have people leaning in to look over their shoulders. This can be a big enhancement of confidence and can gift workers the capability to complete the job the way they consider it to be best done in.
The previous office tedium is exceptional in gig work. With the large range of chores and clients each day, the work keeps getting out of the ordinary and seems to facilitate the gig workers to be more enthusiastic and resourceful in their work. There isn’t going to be a dull day in gig work except if it’s your own call.
Disadvantages of a Gig Economy
1. Taxes and expenses
As contract gig workers aren’t lawfully categorized as “employees”, their employers do not hold back income tax or social security taxes from their incomes. Because of this, gig workers are supposed to make quarterly expected tax recompenses to the IRS rooted in what they have earned.
In most cases, they need to pay from 25%-30% of each of their pays so as to keep away from outstanding taxes at the filing time. Besides, most gig workers are accountable for buying their own work-related equipment like cars, computers, Smartphones, etc. A few of these expenses can be deducted from the taxes while not all can.
2. Ethical issues
The gig economy has been questioned a lot of times in terms of ethics. You have to be watchful with the gig economy if you are a company flourishing on an ethical standing. Because of the verity that employment is casual with no benefits provided to the employees, you might crash into ethical impasses when it comes to the conduct of workers.
3. Lack of Cultural Unity
While it might be the benefit of flexibility to some, others might find the isolated, detached life of the gig economy to be a setback. More often, freelance workers don’t work from the office and consequently miss out on the social constituents present there, like- parties, small talks, and so on. They work alone at home. Despite adding flexibility to the work, this can cause seclusion from other workers and generate the feeling of being removed or left out.
4. More Stress
Full-time workers are seen to work with the assurance of knowing that their employment status is considered secure. Despite the possibilities of layoffs, the threat of such a situation is moderately low for the average person. On the other hand, as you make money by means of the gig economy, you always have to look out for a subsequent job and be geared up to deal with the changes you might stumble upon with the alteration in assignments.
With this many other unanticipated circumstances might arise, together with being let go in the middle of a project. With the addition of these factors to the scenario of being isolated from everyone else, it can be quite tough for you to cope with some conditions. In addition, your earnings are not at all 100% secure.
5. Takes Longer to Build a Depth of Experience
When first starting to look for work, the first job people from the past landed with an established corporation would mostly be the single place of work for their whole lives. The unchanged work and process would keep repeating for years before they retired.
This never led them to worry about the next step to be taken or the money the next step would help them make. This arrangement permitted for a building of depth and experience that is matchless compared to the gig economy at present.
Sources:(Last Updated On: January 1, 2021)