How side hustles are changing work: Benefits of the gig economy
Rise of the Gig economy
"The gig economy," although an old term, has gained quite a lot of popularity in recent years. It is, in fact, one of the most talked-about phenomena in the "labor market." According to a recent study, gig economy workers will take up more than half of the US workforce by 2027.
Furthermore, about 94% of US adults believe that gig jobs are an excellent way of earning extra money and providing the flexibility they desire.
What is a Gig economy?
Gig-economy comprises self-employed, freelance workers or gig workers who carry out on-demand work or tasks directly for their clients, usually on a short-term basis.
A gig worker may work on multiple gig jobs to make a living or use it as an addition to his traditional job to earn some extra income. Many contract workers also step into the gig work with side hustles.
The significant growth in the gig economy requires a closer understanding of the pros and cons of the gig economy and its impact on society and employment.
What are the Pros and Cons of Gig Economy Jobs?
The gig economy or increasing side hustles are changing the workforce in various ways. For instance, full-time employees stuck on 9-5 jobs can work in a more flexible environment or on their own schedule for some additional income.
Benefits of the gig economy or side hustle for employees
Working in a gig economy may give you a lot of flexibility. Gig economy workers may find various options that involve the freedom to work on hours of their choice and from where they want. Many students, individuals with health issues, young families, or other obligations also benefit from the flexibility in the gig economy.
"This flexibility has allowed freelancers and self-employed entrepreneurs to contribute their expertise without committing to long-term contracts or jobs," said Jamie Irwin, Digital Marketing Executive at ELocker.
And it benefits not only full-time gig workers but part-time workers too. For instance, traditional employees or full-time employees may work on weekends or at hours convenient to them for some extra cash that may help their financial goals like to save money, paying debt, etc.
Gig workers are often given the freedom to complete their work. This freedom of work helps to boost the confidence of the workers, as well as their sense of responsibility. "I think the most powerful aspect of any side hustle is the perspective it gives you," said Larissa Pickens, Co-Founder of Dapper Confidential. She added, "with a side hustle, in the beginning, you're usually doing everything yourself and have to learn how to relentlessly prioritize."
Variety in Jobs
When working in a gig economy, workers may find themselves surrounded by a variety of job options. Instead of the same monotonous job In a 9 to 5 employment, gig work provides a variety of prospects or elements in every project or task.
"This allows them to work more on their own terms and to work on projects that they're more passionate about," said Christa Reed, Head of Job Market Research at JobSearcher. When working on projects that vary from one another, workers may find more enthusiasm and a place for creativity in their work.
Pay and Back up
The payment as a gig worker may depend on and vary from project to project and industry to industry. While some companies and job roles pay less, others may pay more. However, gig work or side hustles benefit individuals in building their income structure on multiple income sources. It means you can still rely on your next gig if you lose on one project or source of income.
Simultaneously, individuals working on gigs or side hustles besides their ongoing work or full-time work may have some additional cash to help cover their personal expenses or contribute towards their financial goals.
Maintain Work-life balance
Having a home-based job or the ability to work on hours of your preference helps individuals to create a better work-life balance. "Employees are now splitting their focus between families and their side jobs and are less eager to work longer hours for their primary positions," said Andrew Adamo, VP at Bullion Shark. Being able to balance work life besides family schedules acts as a motivation for most individuals.
The gig economy also benefits people dissatisfied with their 9 to 5 jobs. With the rise of the gig economy, they can easily switch from traditional jobs to gig roles. "You now have the ability to replace your full-time job with several "side hustles" that pay well and give you the flexibility to work from home and set your own hours," explains Dennis Consorte, Digital Marketing & Leadership Consultant for Startups at Snackable Solutions.
They may work consistently depending on their skills or the work interesting to them.
Benefits of the gig economy for employers
A pool of workers
When companies hire gig workers for projects or tasks, they have access to a diversified pool of workers to get their work done. These independent contractors usually work outside office hours, which makes work getting done at night or early morning easier.
Some independent contractors may also be available on weekends from the comfort of their homes.
In addition, gig workers in the gig economy have varying skill levels, which companies can use in a variety of projects. This ensures more flexibility and creativity for companies.
The gig economy benefits companies by reducing the costs associated with a full-time employee. For instance, employers are not required to pay for equipment required to get the job done or provide office space to gig workers. Other expenses like health insurance, retirement benefits, paid leaves, etc., which are necessary in case of a full-time employee, can be avoided by companies when hiring freelance workers.
This means a company can reduce the overall cost of the employee and pay only for actual labor or the work done by the freelancers.
Businesses can scale quickly.
Hiring freelancers can help companies quickly scale their businesses by finding the right people with the right skills and efficiency to get the job done. Most freelancers can be found quickly through marketing strategies, reputations, or referrals.
It helps companies save time and money while meeting their goals.
Cons of the gig economy
Individuals involved in the gig economy usually face the following challenges.
- Essential employment packages like pensions, health insurance benefits, paid leaves, etc., are not covered by the employer.
- Job security in terms of layoff or dismissal packages is limited.
- Unlike full-time employees, a gig economy worker is considered a self-employed individual and must file for business income tax.
The gig economy offers many benefits for employees as well as the company. It opens a diverse pool of skilled employees for the company to hire and get a task or work completed. It is especially beneficial to an employer when hiring full-time employees is challenging.
Besides hiring talent, the gig economy helps businesses by reducing their overall employee costs. Gig workers are paid only for the services or labor given to the company.
From the employee's perspective, they are responsible for completing the work by the end date (or as discussed) with flexibility and independence. In addition, gig workers may prefer to work on multiple projects.
The rise of the gig economy is changing the workforce by opening multiple job opportunities and sources of income to workers, enabling them to work on low-intensity jobs and simultaneously learn new skills.