The Future of Gig Work and the Gig Economy
The gig economy refers to a labor market sector dedicated to freelance workers and short-term contracts. Gig work has come under scrutiny over the last several years, especially regarding workers' rights and fair pay. Despite the controversy of some gig "occupations," the sector continues to thrive and challenge workplace norms.
Estimations suggest the gig economy is expanding, on average, three times faster than the total U.S. workforce. Also, by 2027, experts explain that over 50% of the workforce will take part in gig work. With these numbers and projections, it is clear the gig economy isn't going anywhere, nor is it slowing down any time soon.
Inflation and Increasing Number of Gig Workers
One driving force of the recent surge in gig workers is the historic rise in prices. Inflation made it impossible for people to live with just their salaries or employment incomes, forcing them to take on contract or freelance work. Many gig employers, like Uber, experienced a significant gain in the latter half of 2022.
While inflation drove a recent influx of gig workers, it is not the only motivating factor. Many people choose independent contract work or freelance positions because they provide greater job satisfaction or allow for a greater work-life balance. While current trends suggest gig workers are happy with their choices, there are risks to worker increases.
Potential Risks of a Flooding Job Market
Many gig jobs are competitive and offer limited work. With more people flooding the freelance marketplace, competition is fierce. The competition does little to affect pay for some tasks or jobs, but for others, the gig worker movement is causing significant financial strain.
Ridesharing apps, like Uber and Lyft, only use freelance or contracted workers. These workers essentially cover specific areas. Unfortunately, the more workers within a particular area, the more competition there is for rides, meaning fewer opportunities for money.
Employers or services can help manage financial risks for workers by limiting the number of hires. Unfortunately, some companies are not as concerned with fairness as they are with profits.
Growth Expected to Continue
Despite the gig economy being around since 1915, only in recent years, with the growth of technology and accessibility, has it flourished. It is easier than ever for a person to download an app and start earning money. Many gig jobs don't even require interviews or significant application vetting processes.
The promise of a quick buck and the ability to be in charge of your hours and income motivates so many people to try gig work. While no one is getting rich from gigs, they can make a living and experience freedom they may not have from other professions or occupations.
Gig work opportunities will continue to develop, and the market will grow. While the world may see a temporary slowdown as inflation settles, workers still long for freedom in the workplace, and gig work seems to offer some modicum of that dream.
The gig economy is nothing new, but technology has made its prospects more accessible. Experts believe that nearly half the U.S. population will take part in gig work within the next five years, meaning any predictions of a slowdown are likely inaccurate.