What Are the Benefits of the Gig Economy for Workers?
This week, we’re weighing the pros and cons of gig work from the employee’s point of view (In case you missed it, we answered the question: “What is the Gig Economy”? a little while ago). The next post we’ll do the same but from an employer’s viewpoint. Keep reading to learn more about freelancing and independent contracting gig work—and explore the benefits of the gig economy for workers in today’s blog!
Pros: The Benefits of the Gig Economy for Workers
More independence and freedom are two of the most well-known advantages of working in the gig economy. To be properly classified as an Independent Contractor or “IC,” the IRS mandates that you must not “act” like a wage-earning employee. This means that ICs generally enjoy broad flexibility regarding when, where, and what they’ll work on. Gig work may also provide means to support passion pursuits.
Gig work is a good way for artists/creatives to make a living while dedicating time to make their art and building up a career; it’s an opportunity that increases one’s ability to seek out the perfect position, helping to provide at least some income while searching for their desired full-time job.
Greater Need For Labor Force Participation
Increased labor force participation is also a “pro” for workers. The ready access to gigs—whether through placement agencies or online gig platforms—can help keep a worker off unemployment. Gig work lowers the risk of job and income loss by enabling a worker to earn with multiple employers.
Furthermore, working on numerous projects for a number of different companies can help a worker expand their skill sets and may also expose them to more opportunities than they’d encounter working in one full-time role.
“Specialization Leads to Satisfaction”
As a gig worker, there is a greater opportunity to connect with work in specific areas, and you can seek gigs that allow you to do the type of work you do best. In this way, a worker can enjoy higher levels of job satisfaction and avoid the drudgery they find in facets of a full-time job.
Potential Drawbacks of a Gig Career
On the other hand, there can be a downside to leaving the W2 realm for the gig economy. Here are some clear-eyed concerns to consider:
Not As Much Social Protection
Less social protection is something many workers point to when asked about the downsides of their experiences as gig workers. It is not news to most that, as a gig worker, there aren’t typically any of the benefits delivered by a full-time job.
There’s no unemployment insurance when your gig dries up. Most gig workers have no PTO, sick days, holidays, or other perks. Most critically, there is a higher risk of remaining financially viable without a predictable salary.
A heavier administrative and financial burden is also a downside to gig work. Contractors must shoulder their own organizational efforts because there is no HR department to handle these tasks for independents. That means gig workers are on their own to do their own tax withholding and reporting, retirement planning, and sourcing/funding healthcare coverage.
Moreover, ICs lack infrastructure support in areas like marketing, business development, and accounting. As a gig worker, it’s all on you to find more customers and run your own business. That can be challenging for some.
It Can Be Isolating
Isolation and alienation can be problematic for the gig worker. For gig workers like designers, developers, or copywriters, almost all gig work is performed remotely, which can be isolating. Lack of onsite workplace relationships can get lonely, but it can also impact network building.
Working in the absence of roles and communities that anchor identities in onsite workplaces can make it harder to maintain work relationships should a worker return to jobs where they must work with regular colleagues.
Connect with Experts in Workforce Solutions
There are other pros and cons to being a gig economy worker, and everyone’s situation is different: different needs, temperaments, and other factors drive everyone. nextSource is here to help make the right decisions for workers and employers alike. Let us know how we can help you!