Gig Economy: The Word is Out!

By Pritish Gupta

           Before you jump off your chair reading the word ‘gig’ assuming it to be akin to some live music performance, hold your horses. The use of the word ‘gig’ in the economy is as different from music as chalk and cheese. Are you tired of the usual nine to five grind, then jump into the bandwagon of gigs. Gig economy refers to a free market system in which temporary positions are common and organizations contract with independent workers for short-term engagements. Can you whiff an air of excitement? With the world job market in shambles, the gig economy offers the light at the end of the tunnel. Let’s unravel the ‘not so’ complicated world of gig economy.

            With the organizational life becoming monotonous, the gig economy offers the independence of choice & hiatus from the emotional upheaval as the ‘iron bowl’ has already started developing cracks. With automation ready to unleash havoc on the job front, the gig economy can provide the cushion the workforce longs for. The emergence of ride-hailing and task-oriented service platforms reflect the growth of the freelance economy. Uber & Lyft as ride-sharing apps has reshaped the transportation sector as the cities get more creative. Airbnb too is a classic example of a gig which has revamped the hospitality sector. These gig platforms are raking profit and with all the three companies itching to go ‘public’ in 2019, the economic shift would become all the more flint. A McKinsey report finds that up to 162 million people in Europe & the United States – or 20 to 30 percent of the working-age population – engage in some form of independent work. Some argue that fast-rising minimum wages across Britain and the US have made it harder for businesses to hire more workers, enticing the workforce towards independent work.

             After the economic collapse of 2008, the gig economy picked up the winds of change. With job losses in the traditional economy, the growth of the gig economy became inevitable. The crisis struck at a time when millennials were still completing college or entering the workforce as neophytes. The financial crisis triggered uncertainty which in turn strengthened the debut of the gig economy. It’s a myth that only teens & college graduates tune into gigs, rather, studies have shown that people supporting families have found to be equally contributing to the numbers. People choose to be in the gig economy partly due to flexibility so that they can focus on other priorities or to earn that extra dime. It is definitely ‘creating exciting economies and ushering innovation’. WeWork, a global network of workspaces even provides shared workstations to startup communities and independent workers.

             But the Grinch is in no mood to show any quarter. There are fault lines in the gig economy as well. Most importantly, gig workers don’t get all the rights and benefits as given to the traditional employers including minimum wages & insurance. It is still unclear whether this type of model is sustainable for the workers in the long run including workspace protections, working hours etc. Due to the global footprint of the gig economy, it is difficult for the lawmakers & regulators to protect the novice workforce. These issues if not heeded might prove to be the canary in the coal mine. Though a glimmer of hope can be seen. Last year, a Dutch gig Hilfr which sends cleaners to private homes, floated an agreement that the workers who completed 100 hours of work on the app would automatically get covered by the agreement which provides them with minimum wages, sick pay etc. It may not work with every gig but the approach can be followed to show that the benefits of the gig economy are compatible with giving protection to workers.

        When we speak about the ‘millennial’, we have to combine it with the sharing economy. Millennials are embracing the gig economy with open hands. It gives entrepreneurs a chance to be their own boss. It is radically transforming the job market. The segue is happening at a faster pace than imagined. It gets your eyeballs rolling when you see people inclined to dog walking or dog sitting & considering it a fun part-time gig. It’s fast becoming a cultural phenomenon. Let’s grab the nearest WeWork station. Carpe Diem!

Pritish Gupta is a Masters student at Jindal School of International Affairs.


References:

Manyika, James, Susan Lund, Jacques Bughin, Kelsey Robinson, Jan Mischke, and Deepa Mahajan. “Independent Work: Choice, Necessity, and the Gig Economy.” McKinsey & Company. Accessed February 08, 2019. https://www.mckinsey.com/featured-insights/employment-and-growth/independent-work-choice-necessity-and-the-gig-economy.

Image Source: Newyorker

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