The world’s biggest gig: How the gig economy will change in the future

@IE University

It was once more used in bars and other music venues, but now the term “gig” has grown to include any job that is paid per project, as opposed to on a salary.

As the world of work changes at a blinding pace, we are heading towards a future where these freelance gigs become the norm.

The future is now

In many ways, the gig economy has already arrived. In the United States, over half of the businesses rely on freelance workers or contractors to some degree. Almost every industry, trade, or sector you can imagine makes use of this type of work, meaning there is a huge demand for a wide variety of skills. There are gig workers in web development and education. You can find them in marketing or the delivery industry. Even construction jobs can often be gig-based.

But we’re just getting started. It’s predicted that by 2021, these gig jobs will actually outnumber traditional nine-to-five, office-based jobs. And by 2027, up to 60% of the workforce will consist of freelance professionals, putting legislative pressure on governments and forcing companies to spend up to $6 billion on improving workers’ rights.

The future is certainly gig-centric—but why is that?

Gig economy

The reason for the trend

While there are a number of reasons behind the gig economy, the main driving force is technology. From better, more reliable internet to cloud-based software becoming the norm, the conditions are perfect for this new form of work.

Alongside the technological shift, there has also been a distinct mindset shift. Increasingly, younger workers are shying away from traditional, stable jobs and opting for remote working options. According to one source, up to 92% of millennial workers prefer this kind of setup.

And it’s no surprise—there are many upsides for both the person hiring and the worker. We’ll look first at how it benefits the worker.

Living free and with a perfect harmony

For many of us, traveling is more than a two-week holiday in a resort by the beach. It’s a way of life. It doesn’t matter if you hop from city to city every year or live full time on a boat, the rise of the gig economy has made these kinds of lifestyles accessible to all. The flexibility you can get from remote work allows younger people to realize their dreams of adventures.

Yet it’s not all about travel, this flexibility can also be a lifesaver for young families or people who really appreciate a harmonic work-life balance. You can cut out commutes, get rid of daycare spending, or simply take control of your life and live it in the way you want.

A world of cheaper, better choices

For employers, the trend towards a gig economy also has a lot of substantial benefits—mainly increased choice and reduced costs.

Before the digital revolution transformed our global society, employers had a limited talent pool. Bigger cities had a better choice as people flocked to them to find the best jobs. But unless your business was based in New York, Tokyo or London, you had fewer options. The internet changed that. Suddenly, no matter where your business was based, you could have access to a global talent pool.

As platforms became more sophisticated and supply and demand better connected, businesses were able to find the best people for their jobs, regardless of where they were in the world. What’s more, they were able to hire people just for the job they needed. They didn’t have to hire people and pay them when they weren’t working, resulting in unnecessary expenses.

When it all goes smoothly, the gig setup is almost like a professional eutopia, where both employers and employees get the best of all worlds. But that’s not always the case.

scale

When the balance is off

You are a freelancer and you have a few stable gigs. You can pay your bills, taxes, and have a comfortable life. These gigs develop, you get a reputation, you get more gigs, you’re able to charge more because of your experience. Before long, you can afford a better house and a nicer car. Then a couple of things happen.

First, one of your stable gigs decides you’re too expensive and they can find the same work for cheaper. You lose that job. Then, you’ve not taken a holiday for a long time because you won’t get paid. The stress builds and you get sick. You lose more clients because you’re not able to meet their expectations. You still have all your bills, taxes to pay, and there is so much competition you can’t charge new clients what you were before. Suddenly, your livelihood is in jeopardy.

This is an extreme example of what can happen. But it can happen. With massive, global competition, an incentive for companies to find the cheapest option, and no job security, the dream lifestyle can be quite fragile.

Resetting the balance and supercharging the future

If, as we previously said, up to 60% of the workforce is set to end up working in a gig-based format, the above situation can’t be allowed to happen. For one person, it’s a tragedy—for 60% of the workforce, it’s an economic disaster.

As our world changes, we must change with it. Gig workers will need more collaborative spaces, where they can get a sense of community and emotional support when times are tough. But above all, new laws will need to be passed in countries around the world to ensure security. Freelance workers will need access to healthcare, tax benefits, and ensure their quality work is fairly paid.

The change is already well underway and there’s no turning back. With the gig economy, we have an exciting future ahead of use that gives us unprecedented professional freedom and cost-effective contracting options. While there are challenges, we will face them as a global society, and together we can ensure that the change is positive, sustainable and beneficial to all.