Essay on The Gig Economy
The "Gig Economy" represents the evolution of the long standing American ideology of Capitalism. Advocates claim this economy creates opportunities while detractors claim it represents exploitation. "Gigs" are changing the way business is done around the globe either for better or for worse. Workers are given more freedom but they give up the dependability of a typical job with benefits and stability. The "Gig Economy" is the shot in the arm our stagnant economy needs to transition into the next generation.
Workforce trends suggest that there are 57 million Americans who serve as freelancers in an ever growing gig economy. This begs the question why? People will always seek opportunities to better themselves from the introduction of the American Federation of Labor established in 1886 to 1909 when pensions were introduced. When people moved from the farms to modern day offices, people did this to better themselves. The "Gig Economy" represents the next major transition in the American workplaces as people go out on their own create a living for themselves. Freelancers is a relatively new concept to the public but it's origins can be dated all the way back to the 18th century when John Cannon, living in rural England, took jobs as an agricultural laborer and teacher on the side and gave a percent of his earnings to Thomas Parsons for giving him clients. These two individuals didn't realize what they had started would not catch on till the 21st century but would be an influential piece in the American Economy today. This concept of contacting an individual through a service is the basis for all the major gig jobs today such as Uber, Lyft, and Craigslist. These gig corporations give individuals the freedom to use their specialized skills on their own time to make their living of their work output.
More than one third of people in the workplace work in the "Gig Economy" and the demand for these workers is on the rise. This economy is growing by 2.6% every year and by 2020 based on workplace projections 50% of Americans will be working in this economy. Why is there such a demand for this less than reliable service? There is a vetting service for most gig jobs but it is minimal people choose this type of service for three main reasons: cost, convenience, specialization. Freelancers generally are cheaper than local workers because they don't require vacation days, benefits, training, and you don't have to pay taxes that employers have to pay full-time employees such as Medicare, Social Security, Workmen's Compensation and Federal Employment Insurance. For example, you could pay a freelancer to do three months of work at 150 dollars per hour or hire an employee at 100,000 dollars per year, if that said worker works 50 hours a week you pay 90,000 dollars as opposed to 100,000 dollars and you would generally be getting a more experienced worker. After this job was done you would be overstaffed and forced to keep that employees benefits and his eventual severance pay. Freelancers can come from all around the world and can work around the clock while companies have certain hours they must abide by per federal regulations. Freelancing is the most efficient way to outsource your work because you can only work so many hours in the day but a freelancer in China can work the other side of the clock for you and your business will have 24 hour functionality. Quality of the product you are getting from your freelancer is the key for most companies when they outsource jobs. When you hire a freelancer you can find someone who specializes in the work your are hiring for versus hiring someone and having to train them in the job which causes a stall in productivity and income. As the business grows the company can outsource more freelancers which gives you the flexibility to scale the companies growth exponentially as opposed to bringing in more staff. Every successful company in the world is successful for three reasons profit margins, quality of work, and availability which all comes when you hire a freelancer.
"When working in the gig economy, sometimes you do not feel the stability that you have if you were to work for a company"(Zamir 6). Lack of stability, keeping track of their own taxes, managing their own work schedule, and the lack of benefits are the key disadvantages a freelancer has as opposed to the general business employee. The everyday freelancer is faced with that choice to bet on themselves or stay stuck in mediocrity. Much like a sales man who chooses to work on commission versus a set salary. People who bet on themselves throughout history are the innovators who change lives from the invention of electricity, to industry as we know it, innovators will always drive our world forward. "It's difficult to find reliable freelancers who can keep up a high quality of work"( Kothimangalam 3). Freelancers are risky to employers because every freelancer has their own preferences, but to avoid this the employer must set clear expectations prior to the beginning of the job. "Gigging" is the future as per the Democratic National convention which stated, "Gigging life was not only sustainable but the embodiment of today's progressive values"(Lehane 4-5). Nobody knows where this new economy will take us but we can be sure of one thing, the Gig economy is driving us forward.
The Gig Economy is the catalyst for innovation in the marketplace as we know it. From Uber to Airbnb these companies were formed from one simple ideal which is to be different. Innovators will always carry us forward. Although freelancers carry some amount of risk the benefits cannot be ignored from cost to convenience, freelancers are the future. People choose to freelance for the independence and as a result they a changing the way business is done in the world. The Global Marketplace must either adapt to these progressive ideals or be left behind in the past.