Research Guides: Gig Economy: Home

Definition

What Is the Gig Economy?

In a gig economy, temporary, flexible jobs are commonplace and companies tend to hire independent contractors and freelancers instead of full-time employees. A gig economy undermines the traditional economy of full-time workers who often focus on their career development.

KEY TAKEAWAYS

The gig economy is based on flexible, temporary, or freelance jobs, often involving connecting with clients or customers through an online platform.
The gig economy can benefit workers, businesses, and consumers by making work more adaptable to the needs of the moment and demand for flexible lifestyles.
At the same time, the gig economy can have downsides due to the erosion of traditional economic relationships between workers, businesses, and clients.

Quoted from:
The Investopedia Team. (2021, February 4). Gig economy. Investopedia.
https://www.investopedia.com/terms/g/gig-economy.asp

Gig Economy

A gig economy refers to a working arrangement that revolves around individual jobs. In a gig economy, employers utilize short-term contracts instead of long-term employment arrangements. Freelancers or contractors can opt to take these contracts, allowing them to work whenever they choose to do so. In this manner, freelancers are given an unprecedented amount of freedom. However, in exchange, they lose much of the job security associated with traditional forms of employment. Freelancers are never guaranteed that work beyond their immediate contract will be available in the future.

Quoted from:
Biscontini, T. (2020). Gig economy. Salem Press Encyclopedia.

Articles

Thriving in the Gig Economy

Approximately 150 million people in North America and Western Europe now work as independent contractors, most of them in knowledge-intensive industries and creative occupations. The authors studied 65 of them in depth and learned that although they feel a host of personal, social, and economic anxieties without the cover and support of a traditional employer, they also say they chose independence and wouldn’t give up the benefits that come with it.

Many of these workers have created a “holding environment” for themselves by establishing four connections: (1) place, in the form of idiosyncratic, dedicated workspaces that allow easy access to the tools of their owners’ trades; (2) routines that streamline workflow and incorporate personal care; (3) purpose, to create a bridge between personal interests and motivations and a need in the world; and (4) people to whom they turn for reassurance and encouragement. These connections help independent workers sustain productivity, endure their anxieties, and even turn those feelings into sources of creativity and growth.

Quoted From:
Petriglieri, G. , Ashford, S.J., & Wrzesniewski, A. (2018, March-April)Thriving in the Gig Economy. Harvard Business Review. https://hbr.org/2018/03/thriving-in-the-gig-economy

Pros and cons of gig work

Gig workers may do varied tasks, but they have similar things they enjoy—and don’t—about their arrangements.

Freedom to work as they please is what many people like, but with autonomy comes responsibility. For example, it can be stressful for gig workers to ensure that they have consistent income. “When you’re a freelancer, you make the decisions, which is fantastic,” says Theresa Anderson of Las Vegas, Nevada, who does graphic design projects part time from her home. “But it can also be really scary.”

Pros

Gig workers say that they like being in control. They can choose projects they enjoy and schedule their work around their lives.
Flexibility. People who want to work without having set hours may look for gigs to fit their schedules. “I log on and work when I want,” says Ariana Baseman, a rideshare driver in Detroit, Michigan, who transports passengers in her spare time, in addition to working a traditional, full-time job. “It’s that flexible."
Like other types of flexible employment arrangements, gigs may offer workers an option for adaptability. “The thing that I love about it is the freedom,” says Nick Walter, of Salt Lake City, Utah, who creates online classes in computer programming. “If you decide you want to go on vacation, you can do that.”
Variety. Gigs may provide workers with a chance to try several types of jobs. As a result, they present variety and career exploration to both new and experienced workers. “Take opportunities when they arise,” says Heenan. “You have a lot of chances to do different things.”
And if you’re a “people person,” gig work may offer interaction with a diverse clientele. “I love that I get to constantly work with different people,” says Hayes. “I’m pretty social, so I enjoy meeting all types.”
Passion. You might want to select gigs the same way you would traditional employment: by finding work in which you pursue your interests. And depending on how you schedule your gigs, you might be able to choose among many passions.
Some workers take gigs that allow them to encourage others in a field they enjoy. For example, retired business owner Tamma Ford of Seattle, Washington, takes consulting gigs that let her share her expertise with people who are just getting started.

Cons

There’s a lot of uncertainty associated with gig work. For example, you’ll need to have a steady stream of gigs to get consistent pay. Even then, the amount you earn may not offset some of the costs you’ll be responsible for outside of a traditional employment relationship, such as benefits.

Inconsistency. Landing enough work to provide a stable income from gigs alone isn’t always easy, or even possible. As a result, many gig workers find gigs adequate for part-time work but not a full-time career.
Workers may struggle with looking for jobs, not knowing what—if anything—will come next. “Sometimes you’re not making any money because you’re not getting any work,” says Baseman. “That part’s not really in your control.” And even after you complete a gig, you may face periods of no income if there are delays in getting paid.
Scheduling. Not having set hours or an employer who provides direction for the day is challenging for some gig workers. “Unless you’re a very dedicated, self-motivated individual, it can be hard to focus,” says Walter. “There’s no one telling you what to do, no deadlines.”
And depending on the gig, you may need to work nonstandard days or times to finish a job. If you get a gig requiring hours on the weekend, for example, you might not be able to spend time with friends who have traditional 9-to-5 workweeks.
Lack of benefits. Gig workers don’t usually get employer-paid benefits, such as premiums on health insurance and contributions to retirement plans. You’ll need to research these topics and pay for the products yourself. “I took things like health insurance for granted,” says Heenan of his former job, working at a school. “When you freelance, you have to find those things on your own, and it’s expensive.”
Other benefits that gig workers often miss out on are annual leave and sick leave. Like any employees who don’t get paid time off, no work means no pay.

Quoted from:
Torpey, E. & Hogan, A. (2016, May). Working in a gig economy. U.S. Bureau of Labor Statistics.
https://www.bls.gov/careeroutlook/2016/article/what-is-the-gig-economy.htm

The Gig Economy Comes for Scholarly Work (The Chronicle of Higher Education,May, 2022)

Videos

CQ Researcher

The Gig Economy - Is the trend toward non-staff employees good for workers?
Enabled by the digital revolution, employers increasingly are outsourcing work to contractors and self-employed or part-time workers, many working off-site thanks to apps and Wi-Fi. Supporters of the so-called gig economy say it gives workers flexibility and freedom to work anytime and anywhere and allows struggling companies to survive and healthy firms to compete globally. But labor unions say outsourcing exploits workers and undermines the economy by allowing companies to replace full-time employees with lower-paid workers without guaranteed hours, income or benefits. And millions of laid-off workers must cobble together multiple jobs as independent contractors. On-demand gig workers, such as Uber drivers, are protesting their lack of benefits, while Uber lobbies local and state governments to exempt it from “old economy” wage and labor laws. Recently, however, some employers have begun hiring full-time employees with full benefits again, largely because of the high turnover rates and recruitment costs associated with the gig economy.
The Nature of Work - Will the pandemic permanently alter the workplace?
The COVID-19 pandemic is changing the world of work, accelerating trends that have been percolating for years, such as remote work and increased use of automation and artificial intelligence. As offices and workplaces closed due to the pandemic this spring, working from home became the new normal for many white-collar workers. Some employers have said remote work will be a big part of the future for their employees. Others, such as those working at grocery stores, meatpacking plants or Amazon warehouses, are considered essential workers and continue to go into workplaces, often at considerable risk, although many companies have implemented measures aimed at keeping them safe. However, the pandemic has left millions of Americans unemployed, especially those in occupations that do not accommodate remote work or whose companies cut staff or went out of business. After peaking at a modern high of 14.7 percent in April, the unemployment rate has gradually declined. But it is unclear when — or if — all of those who have lost their jobs will find new ones.

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