Question

What is the difference between Gig workers and traditional workers; are workers within the Gig economy employees or independent contractors; who benefits?

Answer 1

Job - A job is work done for pay. Jobs may be piecework, hourly, salaried, task-based, project-based, and many other options. When we hear the word ‘job’, we typically think of a specific role in a company that you do regularly with the expectation that you’ll return every day indefinitely.

Gig - A gig is a job that lasts a certain period of time, often the life of a project or as long as the company has that specific need. It can be short-term and specific in length, or long-term and lasting as long as the need continues. All gigs are jobs, but not all jobs are gigs.

With gigs, we often think of the music and entertainment industry, but in today’s world this term can be applied to all types of industries and roles. It’s especially common in the creative, IT and technology fields because of the flexible employment model that accompanies the gig economy.

So, back to those initial questions...why should I care, and how does it affect me? Because the world of work has shifted over the last 20+ years, and is continuing to change rapidly. Work looks different, and people think differently about their work.

All work is becoming more ‘gig’-like in nature, regardless of the employment structure. The traditional concept of being in one job for life is inflexible, outdated, and as rare as a unicorn. Because it’s what both people and employers want, jobs are starting to look a lot more like gigs. A gig can turn into long-term employment if that’s what both parties want, but with the (perhaps unspoken) understanding that both parties are committed to each other as long as it makes sense but with no expectation that will be forever.

People want new challenges, fresh ideas, and different opportunities. They no longer stay at one company, or even in one type of career, for their entire work life. An individual may pursue a variety of different types of work, concurrently or one after another. They move companies frequently, and expect new opportunities even if they stay at the same company. This is what a gig mindset gives them, whether the work is packaged as a salaried position or some other option.

What Is the Gig Economy?

In a gig economy, temporary, flexible jobs are commonplace and companies tend toward hiring independent contractors and freelancers instead of full-time employees. A gig economy undermines the traditional economy of full-time workers who rarely change positions and instead focus on a lifetime career.

In a gig economy, large numbers of people work part-time or temporary positions. The result of a gig economy is cheaper, more efficient services, such as Uber or Airbnb, for those willing to use them. Those who don't engage in using technological services such as the Internet tend to be left behind by the benefits of the gig economy. Cities tend to have the most highly developed services and are the most entrenched in the gig economy.

There is a wide range of positions that fall into the category of a gig. For example, adjunct and part-time professors are contracted employees as opposed to tenured or tenure-track professors. Colleges and universities can cut costs and match professors to their academic needs by hiring more adjunct and part-time professors.

The Factors of a Gig Economy

America is well on its way to establishing a gig economy, and estimates show as much as a third of the working population is already in some gig capacity. Experts expect this working number to rise, as these types of positions facilitate independent contracting work as many of those jobs don't require the freelancer to come into the office to work.

Employers also have a wider range of applicants to choose from as they don't have to hire someone based on their proximity. Additionally, computers have developed to the point that they can take the place of the jobs people previously held.

Economic reasons also factor into the development of a gig economy. Most times, employers cannot afford to hire full-time employees to do all the work they need to be done, so they hire part-time or temporary employees to take care of busier times or specific projects.

On the side of the employee, people often find they need to move around or take multiple positions to afford the lifestyle they want. People also tend to change careers many times throughout their lives, so the gig economy can be viewed as a reflection of this occurring on a large scale.

Criticisms of the Gig Economy

Despite its benefits, there are some downsides to the gig economy. While not all employers lean toward hiring contracted employees, the gig economy trend can make it harder for full-time employees to develop fully in their careers since temporary employees are often cheaper to hire and more flexible in their availability. Workers who prefer a traditional career path and the stability and security that come with it are being crowded out in some industries.

For some workers, the flexibility of working gigs can actually disrupt the work-life balance, sleep patterns, and activities of daily life. Flexibility in a gig economy often means that workers have to make themselves available any time gigs come up, regardless of their other needs, and must always be on the hunt for the next gig.

In effect, workers in a gig economy are more like entrepreneurs than traditional workers. While this may mean greater freedom of choice for the individual worker, it also means that the security of a steady job with regular pay, benefits, and a daily routine that has characterized work for generations are rapidly becoming a thing of the past.

Lastly, because of the fluid nature of gig economy transactions and relationships, long-term relationships between workers, employers, clients, and vendors can tend to erode. This can eliminate the benefits that flow from building long-term trust, customary practice, and familiarity with clients and employers. It could also discourage investment in relationship-specific assets that would otherwise be profitable to pursue since no party has an incentive to invest in significantly in a relationship that only lasts until the next gig comes along.