From the Industrial Revolution until about a decade ago, almost all roles in the workforce have been similar. Until recently employees would work eight hours a day for five days a week and remain with the same organization full-time for many years. This routine helped them build a steady retirement fund and provided them with health benefits. New technology and platforms have caused a shift to a gig economy, which is rooted in more flexible, contracted and freelance workers. The gig economy has been growing in size for the past few years. While there are some concerns that gig workers lack the job security and benefits that other longer tenured workers have, both the private sector and government has responded to these concerns by creating some protections for employees in the gig economy. This new type of workforce can seem under regulated and intimidating, so it is best to be prepared and knowledgeable before entering the high risk, high reward gig economy. What is the Gig Economy? Investopedia defines the gig economy as one in which “temporary, flexible jobs are commonplace and companies tend to hire independent contractors and freelancers rather than full-time employees.” The gig economy connects its workers to customers or clients usually through an app or other online service. These workers often choose their own hours to complement a separate job or are considered full-time employees on short contracts. Gig economy work also typically provides cheaper options for the consumer. How Many People Are Employed in the Gig Economy? Gigs are expanding into many fields. While Uber and Lyft drivers are thought of as typical gig economy workers, they actually only account for 16 percent of contracted workers. 56 percent of gig workers are actually in the professional, administrative, or creative fields. Since the the classification of a gig worker is very broad there are not a lot of precise data and statistics on the exact number of employees in the gig economy. Many times when organizations attempt to collect data on gig workers, they also include people who have a part-time role to make extra money and supplement their full time jobs. In addition, some private companies do not release how many gig workers they have. The Bureau of Labor Statistics reported that about 6 million workers, or 4 percent of the entire United States workforce, were in the gig economy. The Federal Reserve reported that there were 75 million gig workers in the United States. Regardless, many of them fly under the radar. Is the Gig Economy Here to Stay? If the trends continue, than the gig economy is here to stay and may very likely expand in the future. 40 percent of companies believe that gig workers will become a larger part of their workforce in the future. Even if you do not plan on gig work being your primary source of income, many people work in the gig economy part time to develop new skills or make extra money on the side. There are some signs that working conditions within the gig economy might improve. Google has begun requiring all of the staffing firms that they get their contracted workers from to pay their employees a $15 per hour minimum wage and provide them with some form of health benefits. The state of California also just enacted a law that requires all contracted workers to be treated the same as conventional employees. Some workers say the gig economy may now just be a unique niche in what is a very complex workforce. Many others argue that the emergence of the gig economy was just a reaction to the economic troubles of the 2008 recession and that the improving economy has strengthened the value of conventional employment. Additional workers have brought up the point that while the gig economy may work for certain types of jobs, other roles that require specialized training or collaboration with other employees will go by the wayside. There is also the argument out there that the labor market is simply supply and demand. Workers might inherently value the stability, structure, and benefits that more traditional jobs have. But if there are not enough of these types of positions offered, jobseekers will turn to freelance and contract work in order to make ends meet. Overall, there is a strong belief in today’s workforce that the popularity of the gig economy will continue to fluctuate with the overall desire for jobs and additional income. What can I do to Prepare to Enter the Gig Economy? The gig economy puts an emphasis on hard skills. When a company is looking to hire freelance or gig workers, it is looking for someone to fulfill a specific need. In the age of LinkedIn and online job application sites, resumes could become less important than portfolios and networking. Cast as wide a net as possible when networking to find the most opportunities for gigs and always work on building your personal brand and reputation. Students looking for work in the gig economy will have to be self-disciplined, as they are their own boss when it comes to finding and maintaining gainful employment. Adaptation is Key It's hard to predict the future, but the rapid emergence of the gig economy shows just how volatile the workforce can be. The gig economy could very well be the primary source of income for most people going forward, or it could continue to occupy its niche in the economy and remain in certain industries such as technology, transportation, and creative services. For anyone entering any industry, they must be prepared to adapt to any changes as best as they can.
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