The Rise of the Gig Economy
American workers are giving a whole new meaning to claiming their independence as the gig economy is on a steady rise to overshadow the corporate workforce that many have come to know and love over the past several decades. Now, more than ever, workers are shifting away from traditional nine-to-five employment and taking their chances as independent contractors and freelancers.
Nearly 34% of American workers make up the gig economy and it’s estimated that by 2020, more than 40 percent of workers will be independent contractors, and that number will continually grow over the decades to come. But what’s caused this shift in employment status for the masses, and why are workers being lured onto the contractor side? There are a number of reasons including work-life balance, financial stress and several other factors that we’ll explore that have become the driving force behind the gig economy.
For most of the labor force, dreams of financial freedom and stability is a major factor that has caused them to seek out freelance and contractor opportunities. The cost-of-living continues to surge across the country while wages remaining stagnant, forcing many workers to look to multiple income streams as a supplement. Rising housing costs and crippling student loan debt have stifled financial freedom for recent generations entering the workforce, and for many it’s merely impossible to generate enough income to sustain a living wage with a single full-time job. The effects of a downsloping economy have caused many workers to seek out opportunities to obtain supplemental income out of necessity more than anything.
Freedom of choice is another reason why many employees are seeking out contractor roles, which often offer more flexibility and work-life balance than traditional office positions. It’s often a dream job for those whose main source of income revolves around contingent roles, where the freedom to create their own schedule and routine while working from a home office trumps being tied down to a strict office schedule and a grueling commute.
Others often use gig roles as a way to supplement income while doing work they are most passionate about, which in turn, leads to them often feeling more fulfilled than their nine-to-five counterparts. Gig roles can also offer workers to test the waters in a new industry and develop new skills that they can add to their repertoire of professional assets. On the flip side, it can also be a way for workers to use talents and passions that they normally wouldn’t be able to use in their traditional roles.
Although there are many perks to gig work—whether it be out of necessity or pleasure—there’s still many facets of the industry that have a downside. Independent contractors and freelancers usually don’t have the same perks or benefits as traditional workers. For instance, contractors and freelance often don’t have the same protections against employee rights and HR-related matters as permanent employees, work can be inconsistent or unstable, and gig workers are responsible for managing their own taxes and allocating finances to appropriately cover tax obligations. On the bright side, advocates are pushing for more rights for gig workers and focusing on changing the overall landscape of the industry.
No matter how you may feel about it, the gig economy is here to stay and will continue to rise as more workers look for ways to adapt it to their ever-changing lifestyles.