The gig economy, also called the “collaborative economy”, the “sharing economy,” and the “platform economy”, has taken over the professional lives of many individuals. The thrill of not being confined to a 9-to-5 job, working at one’s pace, and being one’s own boss are some of the many reasons professionals are leaving their traditional roles and branching out on their own -a trend that has accelerated during the pandemic. There is currently an increased inclination towards skill-based work, flexibility, and additional income; which is further empowering this economy of the future.
However, the growth of the gig economy raises important questions about the protections the gig workers are entitled to, as well as the long-term viability of this working arrangement as far as those protections are concerned. As the economy looks to improve, employers have to consider how to retain the best gig workers to help their organization accelerate recovery efforts in the months and years ahead.
The reason for the trend
While there are several reasons behind the gig economy, the main driving force is technological innovations. From better, more reliable internet to cloud-based software becoming the norm, the conditions are perfect for the new form of work.
Alongside the technological shift, there has also been a distinct shift in mindset – increasingly, younger workers are shifting away from traditional, stable jobs and opting for remote working options. And it’s no surprise—there are many upsides to this kind of arrangement.
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Advantages of the Gig Economy
Large talent pool: According to a study by Deloitte, more than 76 percent of organizations plan to increase their organization’s utilization of independent freelance workers in the next five or so years. This way, businesses can source different work from large talent pools without having to stick to one individual or group.
Budget-friendly: Small businesses or startups can work with and hire experienced employees and developers for freelance work at a lower price and with a smaller commitment. This opportunity allows them to work with qualified people they originally would not have been able to hire full-time.
Win-win situation: The gig economy allows workers to take on a flexible, work-whenever-you-like lifestyle that conveniently works for both the employees and the company. The gig workers, on the other hand, are given the chance to control their professional careers while companies can take advantage of the blended workforce.
Disadvantages of the Gig Economy
While freelance work may sound like the “dream”, it does come with some downsides. On one hand, it’s the future of work, while on the other, it’s Darwinian survival of the fittest.
A big drawback for a gig economy system is the lack of security for the workers. Some critics of the gig economy argue that workers in the freelance world lack protection and fair pay. For example, many freelance employees are not paid benefits like holidays or sick pay. Some reports also suggest that most gig workers do not make the minimum wage.
Also, gig workers have to regularly be working to find their next “gig,” or be prepared for changes in their current one.
Fixing the Disadvantages
It is obvious that many Millennials do not want to be a part of the “old economy” and they’re taking the labor force by storm and changing it into what they want it to be. We can expect more and more workers to join the freelance workforce, and change the way we get things done.
Gig workers will need more collaborative spaces, where they can get emotional support and a sense of community when times are tough. But above all, new policy laws will need to be passed to ensure security and also ensure that the freelance workers get access to healthcare, tax benefits, and ensure their quality work is fairly paid. Companies and policymakers alike should look at expanding the safety nets for the gig workers.
With dynamic technology, increased mobility, shifting demographics, a fluid workforce, enhanced expectations, engagement, and workforce, the organizational landscape is evolving. It is, therefore, up to businesses to utilize the opportunities this shift is presenting to them, and make full use of access to resources from the new work order.