The concept of the gig economy is not a new one. Freelancing has been around for a long time, but digital freelancing platforms like Uber, Lyft, and Fiverr are relatively new. In a nutshell, the gig economy is a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs. But, what is the gig economy, and is it for you?
The Pros and Cons of Freelancing in the Gig Economy
According to a survey conducted in six countries in 2016, 70% of freelancers who chose to work independently of any single company were happier than those in traditional jobs, especially when it came to independence and flexibility in terms of where and when they work. In the US alone, half of freelancers surveyed said there was no amount of money that would convince them to return to the traditional workforce.
To be successful in the gig economy, you’ll need a skill that’s in demand, which can range from driving a car to neurosurgery, and can be in any field. The more people who want your skill, and the fewer people who have it, the more you can charge for your services. The next step is to transform yourself into an entrepreneur, which entails marketing your services, negotiating contracts, building a network of satisfied clients, and developing administrative skills such as project management, time management, and accounting.
However, freelancers do not automatically receive the benefits that come with some salaried jobs, such as paid vacation or sick leave, life insurance, college tuition, or retirement plans. In countries like the US, where healthcare is not provided by the government to most people, freelancers are also responsible for this.
The Rise of Digital Freelancing Platforms
Digital freelancing platforms like Uber, Lyft, and Fiverr can connect you with clients and take care of some of the entrepreneurial and administrative stuff, but there are some hidden costs to consider. For instance, your life may not be as flexible as you think. While you can choose when to work as a rideshare driver, the app recommends what route to take, enforces how you act with the threat of low customer ratings, and sets your rate. Those rates may be so low that you end up working more than if you had a salaried full-time job.
The gig economy also has some drawbacks, and may not provide a reliable living wage. For many around the world who need to make money as soon as possible, the gig economy is the easiest and fastest place to get hired, making it an alternative safety net.
Is the Gig Economy Right for You?
If you are considering joining the gig economy, ask yourself how much you value flexibility or autonomy. Do you prefer to work within a traditional employment model or as a freelancer? The gig economy can be an attractive option for some, but it is not for everyone. In conclusion, while the gig economy may have its pros and cons, the final decision rests on individual preference, weighing the benefits and drawbacks carefully.