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Looking for a gig? The Gig Economy is here!

Looking for a gig? The Gig Economy is here!

ID-10065538No more than five years ago, the only people who looked for “gigs” were musicians. The rest of us found “real” jobs that paid a fixed salary every month, allowing us to take paid holidays and forming the basis of planning a stable future. Today, more and more of us choose, instead, to make our living working gigs rather than full time.

The rise of apps connecting professional services, goods, and lodging directly to consumers via smartphone is exploding. Companies like Uber or AirBnB are changing the way people get around and travel. Gig companies like Postmates aim to bring us anything, whether it be from any store, or right to our door, in under an hour. From moving services, to odd jobs, to dog walking, the possibilities are endless in the new Gig Economy.

A gig economy is an environment in which temporary positions are common, and organizations contract with independent workers for short-term engagements. Whether it’s selling crafts on Etsy or Ebay, offering taxi services through Uber or accommodating tourists in spare rooms via Airbnb, the world of work appears to be changing, and the gig economy gets bigger and bigger.

The latest research estimates that the ranks of the American freelancer now comprise 34% of the U.S. workforce, and while there are some discussions over the exact figures, it’s been argued that by 2040, the economy will be scarcely recognizable” as a result.

Until now, smaller businesses are more likely to feel the impact of the gig economy, since many big companies already have major contracts with partners. Still, the advantages of smaller-scale relationships with specialized freelancers appear to be spreading throughout the entire global workforce.

According to a PwC report , “Economic shifts are redistributing power, wealth, competition, and opportunity around the globe, and the expectations of organisations and the aspirations of the people who want to work for them [are] diverging into three distinct ‘worlds’ of work”:

  • The “blue” world of corporate capitalism
  • The “green” world of social responsibility
  • The “orange” world of smaller, collaborative networks and specialization

The Government tried to define the Gig Economy

Recently, the Commerce Department proposed a four-part definition for what it calls “digital matching firms” and identified more than 100 businesses that likely meet that definition. The new definition, is intended to give government data crunchers and private researchers the characteristics that make up this emerging sector. Setting a framework will aid future data collection, including a joint effort by the Census Bureau, a division of Commerce, and the Bureau of Labor Statistics to produce a report on contingent workers for the first time since 2005.

Under the Commerce definition, digital matching firms:

  • Use technology such as mobile apps to facilitate peer-to-peer transactions
  • Rely on user-based rating systems for quality control
  • Offer workers providing services flexibility in deciding their typical hours
  • Rely on workers to use their own tools or assets to provide a service

While the size of the gig economy or exact number of digital matching firms is impossible to determine from existing government data, the sector has already caught the eye of regulators. Uber and its competitors have been subject to regulations in more than a dozen cities and states.

Although the broader socio-economic effects of the gig economy are yet unclear, one thing is for sure: we must rethink the requirement of our safety net, disassociate it from salaried jobs and making it more readily available to independent workers.

Photo source: http://www.freedigitalphotos.net/

Comment(1)

  • Tim Wessels

    September 7, 2016

    Well, I would not be so sanguine about the corporate-owned so-called “sharing economy” platforms that exist today like Uber and Airbnb. The economic model for these businesses is to skirt state and local regulations, treat workers as non-employee replaceable components, own nothing except the corporate platform, use other people’s assets, such as their homes or cars, and put all the equity and profits into the hands of investors and executives. This is a model for race-to-the-bottom capitalism where the greed of the few trumps fairness and corporate social responsibility.

    The alternative is the creation of cooperative platforms owned by the people who use them…writers, photographers, artists, crafters, cab drivers, house cleaners, tech professional, etc. The tools for doing this are not out of reach and their development would create a fair and equitable economic relationship between the platform cooperative members and their customers. So-called disruptive technology does not have to mean more corporate greed and worker dehumanization. Time for workers to form cooperative platforms and push back against corporate-owned platforms.

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