Even if you're not a part of it, no doubt you've heard of the 'gig' economy and it's steady rise in the professional arena.
#1 What is the gig economy?
The term gig has been used as far back as the 1920s, and used to refer to work traditionally taken on by actors or musicians. It referred to single performances that were short term and temporary in nature. However, with over 15% of the UK's workforce now identifying as self employed, it’s recently begun to ‘buzz’ again.
The gig economy, therefore, refers to a way of working where - instead of having a standard 9-5 working contract - an individual earns their income through a series of short term or one-off ‘gigs’.
Companies like Uber, Deliveroo, and Airbnb are all examples of gig companies, as an individual can work for them as and when they choose, and are paid per ‘gig’ (ie. per guest stay in Airbnb, or per fare in Uber).
#2 Who’s it made for?
According to the Fullfact, over a million people in the UK are part of the gig economy, and that figure is rising. Gig workers tend to be younger, with 34% of them under 30, and they can be doing anything from consulting, to writing and graphic design, and even plumbing or electrical work.
Many people use gig work to earn money whilst studying, or to supplement their main income. It’s also a great opportunity for those who have other full time care responsibilities.
#3 Who really benefits from this, the employer or the employee?
The field is divided over this question, and for good reason. Until recently, the gig economy and its workforce have fallen into a largely ‘grey area’ in which there have been both wins and losses.
The major issue with the gig economy is the lack of workplace protection. Without formal employment there are no minimum guaranteed hours, sick pay benefits, maternity rights, or even holiday pay. There is also little to no protection or compensation if a job falls through at the last minute. Because of this, it has long been seen as a pool of cheap labour for those who wish to reap the benefits of having staff without the legal commitments of actually having to have staff.
There has also been a backlash against the ‘earn an uncapped amount’ spin that has long been touted as one of the benefits of the gig economy, with figures showing that only 28% chose freelancing because it offered more money than traditional employment. Indeed, a study by Gov.uk in 2017 found that 25% of those surveyed reported earning less than the minimum wage.
However, 79% of those who chose to go freelance said they did so because they value the flexibility it offers their life. The gig economy offers a different way forward for both employee and employer. And, with new EU legislation coming into force over the next three years, rights of gig economy workers are set to be further protected, with the banning of ‘exclusivity clauses’ and the introduction of compensation pay for cancelled work.
#4 How can I save money whilst ‘gigging’?
If you’re a ‘gigger’ then saving can be difficult, especially if you can’t guarantee how much you’ll earn any given month. This article gives some great tips on how to save and invest on an irregular income; including advice on the best way to set up your own automated savings steps with Oval - you know Oval, don't you?
For those on an irregular income, saving a percentage of your income rather than a flat amount can be the more effective way to see your savings grow.
#5 What does the future look like for the gig economy?
With giants like Google starting to protect the rights of its agency workers, and governments closing dangerous loopholes around agency working, it is likely that employers will be required to take on more responsibility for their ‘gig staff’.
This, coupled with the growing automation of many areas of work and the development of an information and financial sector that's still in its relative infancy, it is highly likely that the economy will remain, and no doubt flourish - although its face may change - as our concept of what a job and workplace are develop and grow.