What Is the Gig Economy? 3 Benefits for Gig Workers

The gig economy is a system of part-time and full-time employment opportunities for flexible work. Gig workers can find these temporary or freelance opportunities through online platforms or digital applications that allow the worker more autonomy than a traditional salary position. Many economists argue that flexible employment in the gig economy, or shared economy, could become the future of work in the digital age.

A few of the most popular freelance work arrangements in the gig economy—or the sharing economy—include:

1. 1. Delivery persons for food and other products: Delivery apps utilize workers in the gig economy to transport various foods and goods to customers’ homes. Items might include menu options from local dine-in restaurants, groceries from a supermarket, or everyday products from mass-market retailers. These platforms have increased convenience for consumers and created a new kind of role in the gig economy.
2. 2. Drivers for ridesharing services: Many consumers have switched from traditional taxi services to mobile platforms in recent years. To partner with a mobile app, drivers use their own vehicles to transport passengers to and from locations. Each driver and passenger has a visible rating that provides each party with a sense of transparency before the transaction takes place.
   
3. 3. Independent contractors: Online platforms and other websites connect skilled workers with consumers who need talented creatives, coders, and craftsmen. Freelance jobs can range in difficulty from changing a light bulb to designing a website. Each task professional will post their expertise on a platform where clients can bid for their time and skills, or vice versa.

There are several benefits to part-time gig work opportunities for those seeking flexible jobs, including:

1. 1. Flexible employment might allow for greater work-life balance. Gig economy workers make their own schedules, allowing them greater freedom to focus on personal interests or obligations. For example, taking care of family members, pursuing hobbies, and traveling are all examples of activities that gig workers might be able to more easily schedule around their flexible employment.
2. 2. Freelance economy workers enjoy self-employment. Freelance workers can accept or decline specific projects or tasks as they prefer. In some cases, skilled workers with expertise in high-demand fields can even decide the rate that they charge clients. Additionally, many gig workers report that they prefer not having a traditional boss or manager to answer to on a daily basis. That said, gig workers must still abide by the terms and conditions set forth by the companies whose digital platforms or applications they use to find work.
3. 3. Short-term contract work can become a source of extra income. For college students or those who are already employed full time, gig economy jobs offer avenues to bring in additional wages. A flexible work schedule allows these workers to earn enough income to cover some of their basic living expenses while still providing the freedom to pursue their other commitments. “Side hustle” is the term for a second job that a full-time worker picks up to supplement their primary source of income.

Consider the downsides of flexible, independent work before changing your career path.

1. 1. Freelance work does not provide benefits or workplace protections. For full-time employees considering changing their employment situation, a lack of benefits might be a downside to joining the gig economy. There are no human resources teams or legal consultants to ensure gig workers receive minimum wage or have retirement plans in place. Furthermore, flexible jobs rarely offer access to health insurance, which forces gig workers to seek out private providers to purchase personal health care plans.
2. 2. Gig work provides less job security than traditional jobs. Temporary or part-time jobs are usually the first casualties in economic downturns. Furthermore, most gig jobs are low-skill positions with considerable turnover, meaning they cannot provide the same economic stability as a full-time position with salary and benefits.
3. 3. Independent workers must track their expenses and pay quarterly taxes. Each gig worker is essentially a small business owner, and as such, they are responsible for their own budgeting. For example, a shared-ride driver must account for the costs of fuel, vehicle maintenance, vehicle insurance, and taxes. Furthermore, in the United States, freelancers and gig workers must pay their income taxes quarterly, rather than annually.

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