Seven Reasons the Gig Economy is Becoming Our New Reality
The traditional job market arose from necessity and convenience. Before the internet, and even before (reliable) mass transit, the only way to get a job was to find a company that could provide you with stable long-term labor near your home. It became the industry standard not because it was the best option but because it was the only one available. That has changed and will continue to change as technology advances. The GIG economy has evolved from a marginal source of income to presently employing over a third of all workers in the United States (36 percent). In fact, according to Statista Research Department data from May 2021, 86.5 million people in the United States will be freelancing in 2027. That’s 50.9 percent of the total workforce in the United States.
But what are the reasons leading to the change from the traditional job market to the Gig economy?
1. The Evolution of the Internet
High-speed internet present in most countries has enabled remote working. Not just within the same country, however in different countries. You can be in Africa and accept a job in Asia. And it doesn’t apply only to employment but also to training and development opportunities, where you can attend world-class training anywhere in the World. Hence the internet has enabled a world without borders.
2. Ease of Entering the Gig Market
Even for low-paying, manual work, an applicant may be required to submit a CV and engage in an interview to gain traditional employment. Qualifications and experience are needed for the higher levels. At the same time, typical self-employment necessitates incurring the expenditures of starting a business and building a client base. Licensing restrictions can also hamper it. Gig economy platforms can use alternatives to formal qualifications, such as reputation rating techniques, to lower such obstacles to work. Furthermore, workers are usually exempt from the costs of starting a business.
3. What the brain has to Say
In the last decade, new science about the brain has proven that the human brain does not function at its best when it works for eight hours straight. Numerous studies have shown that working in short bursts increases productivity and efficiency. According to a productivity study conducted by Ohio University, the top 10% of highly productive workers do not work eight-hour shifts. They discovered that for the human brain to perform at its best, it requires 15-minute pauses every hour of work. Many freelancers who make up the gig economy understand and know this well. Thus, adopting techniques such as the Pomodoro and adapt their work according to their conditions and style.
4. Multi-talented Individuals
Many people possess various talents and skills that might not be utilized by one single job. For example, someone might have a secretarial position while having a knack for writing. Another might be good as an instructor while having a good talent as a photographer. And much more. Therefore, the Gig economy is suitable for people to experience some freelancing options, develop a good portfolio, and then maybe decide whether to quit their full-time job altogether or not. It also always them to do something they enjoy with some extra income.
5. The Benefit of Autonomy
Freelancing gives individuals more autonomy. Thus, working at their own pace and choosing their suitable workload. Not having a boss makes the person their boss. It also always individuals to make their own decisions, according to their working style, values, and conditions.
6. The High Cost of Full-time Employment
Companies are pressured all the time to make a profit. Therefore, they need to save as much as possible. Therefore, some companies resort to hiring freelancers as it saves recruiting and onboarding costs. In addition, freelancers work remotely. They save office space, benefits, and any other fee paid to a full-time employee.
7. The Satisfaction of Independence
Individuals who choose independent employment as their primary source of income expressed better satisfaction with their output than typical workers, according to a McKinsey study from 2016.2
What do the Numbers Say?
- About 36% of US workers are part of the gig economy.
- 12% of the US workforce started taking freelance jobs during the pandemic.
- 10% of the US workforce was forced to pause freelancing because of the global health crisis.
- 86% of freelancers think the industry has an even brighter future ahead of it, despite the health crisis.
- If the gig economy keeps growing at its current rate, more than 50% of the US workforce will participate in it by 2027.
- In 2018, US independent workers spent a billion hours per week freelancing.
- 41% of postgraduates freelance. 3
According to the most recent statistics on the gig economy, things aren’t just changing; they’ve already transformed. Gone are the days of working a job from 9 a.m. to 5 p.m. Nowadays, it’s more typical to juggle multiple sources of income and work when you want, rather than when your company instructs you to.
1CXC Global, 1 September 2021, Connor Heaney, 10 reasons the Gig Economy will increase its disruption of the working world, 19 September 2021, https://www.cxcglobal.com/10-reasons-the-gig-economy-will-only-get-bigger
Forbes, 27 March 2020, Mike Volkin, Why the Gig Economy will drive the future of employment, 19 September 2021, https://www.forbes.com/sites/forbescoachescouncil/2020/03/27/why-the-gig-economy-will-drive-the-future-of-employment/?sh=635753124f52
2Accessed 20 September 2021, McKinsey & Company
3SmallBizGenius, 26 May 2021, Damjan Jugovic Spajic, The Future Of Employement-30 Telling Gig Economy Statistics, Accessed 30 September 2021, https://www.smallbizgenius.net/by-the-numbers/gig-economy-statistics
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