The New Gig Economy

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A gig is a slang word for a job going for a specified time period and is most commonly used to refer to musicians. Therefore, a gig economy is a free market system where the temporary position is numerous. Companies are now working with independent contractors for short-term engagements. This has created a new economy which has seen tremendous growth in the past few years. The new gig economy can be seen in many sectors such as the ride-hailing apps, collaborative crowd-funding platforms, home sharing, and part-time hires among many others.

1. Factors contributing to the rise of short-term gigs

The gig economy is in full swing and fast-making its way into the lives of millions creating a digital divide. A study by Intuit forecasts that by 2020, over 40% of workers will be freelancers. Below are some of the factors that have fueled growth in the gig economy:

2. Digitization

The digital age has enabled the workforce to be mobile making it possible for freelancers to work from anywhere. This has decoupled job and location enabling freelancers to select the numerous temporary jobs around the world. Likewise, employers can select the best employees for their specified projects from a larger pool.

3. Financial Pressure on Businesses

The increased financial pressure on businesses has seen them result in a flexible workforce. This has introduced the millennial generation into the labor market where people can change their jobs several times through their careers. By contracting freelancers, businesses will save resources in terms of training, office space and benefits. Selecting experts from a larger pool also reduces the costs as it is quite expensive to maintain high-priced staff.

4. Education Gap

Predictions show that there will be one and a half million fewer college-educated workers than the economy requires by 2020 in America. Also, another 6 million people will not have completed high school. This means that businesses will struggle to find qualified experts compelling them to be flexible. They will expand geographically and rely heavily on gig workers so as to meet their needs. The high unskilled workforce will also move to more unskilled gig jobs such as IC driving and data entry.

5. Changing Attitude Towards Work

The millennial generation is entering the workforce with a new attitude towards work. The freelance option is increasingly becoming more popular as it allows the millennials to prioritize the most important things. Millennials are looking for a flexible schedule so that they can travel the world, spend time with family and avoid work politics. Freelance gigs also allow millennials to select projects and companies that appeal best to them. This has seen the rise in remote work which offers more opportunities to choose from.

6. Growth in Technology and Infrastructure

Remote work has become a reality with the introduction of advanced networks, cloud computing, and other technologies. This was impossible a few years ago due to priced hardware and software and lack of telecommunications infrastructure. Modern technology even allows people to work from their smartphones due to increased internet connectivity. There are also numerous applications and software allowing project management, video conferencing and other remote tasks.

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