How the Gig Economy is Shaping the Future of Small Businesses

How the Gig Economy is Shaping the Future of Small Businesses

Gig economy workers specialize in performing small, on-demand projects through technology platforms that may include driving passengers, taking care of pets or writing code.

These nontraditional jobs provide people with more fulfilling careers or simply supplement their income; but they’re posing new challenges to businesses of all sizes.

The Gig Economy is Changing How We Do Business

Work was once tied to a specific location; now gig workers can work from any location and take on projects whenever they arise, saving both companies money in expenses such as office space rent and equipment maintenance, while helping companies find talent without incurring full-time salary costs.

Gig work is becoming increasingly popular among younger workers seeking greater flexibility, yet some worry it could lead to the loss of stability and security in life. Companies may face legal liability if they hire freelancers not considered employees.

Two important preconditions remain key in shaping how the gig economy will develop: state regulation and worker power. Although different people experience different aspects of gig work differently (Woodcock & Graham 2019), its potential to grow is enormous.

The Gig Economy is Changing the Definition of Success

The gig economy can be defined as “an informal labor market characterized by short-term contracts or freelance work.” Although previously present, its prevalence is becoming increasingly common due to technological innovations and consumer demands.

Gig workers operate across industries and complete short, on-demand projects for pay. Typically using digital platforms to connect with businesses and consumers alike, once one project is finished they move onto the next one.

Some gigs provide knowledge-based services like independent management consultants or machine learning data scientists; others are service-related, like tradespeople or delivery drivers. Most gig workers fall under the Census definition of nonemployer businesses.

The gig economy has provided people with greater flexibility to create their own jobs and better align their passions with their careers. Many find working in this space better fits into their lifestyle than traditional employment options.

The Gig Economy is Changing How We Hire

The gig economy offers many people the flexibility of working whenever they wish, yet can also be dangerously unpredictable; contingent workers must often seek multiple gigs just to earn enough to cover living expenses, while they are unable to access traditional employment benefits like unemployment insurance or retirement plans.

The gig economy is driven by app-based technologies that facilitate direct transactions between consumers and service providers such as food delivery or ridesharing apps. People have turned to nontraditional forms of work for various reasons, including an inability to find traditional jobs that offer living wages.

County governments can embrace the gig economy by encouraging its development and learning how to tap its potential for increased economic activity. They can also mitigate risk by making it easier for contingent workers to secure permits and licenses; this helps them perform their work more efficiently while providing increased income to counties through taxes, usage fees and other forms of revenue generation.

The Gig Economy is Changing How We Pay

The gig economy encompasses an expansive spectrum of employment options – from freelance management consultants and data scientists, to on-demand food delivery drivers and on-demand drivers for food service organizations. Some organizations struggle to comply with regulations pertaining to employee benefits for gig workers while others use them as an economical source of high-quality labor.

No matter the motivations behind their gig worker choice, most gig workers appear content with the flexibility and range of work opportunities provided by gig work. Indeed, according to a Cornell study many contingent workers prefer gig work over full-time employment.

As app-based technology platforms continue to enable direct transactions between consumers and providers, more people may gravitate toward gig work. Some may take on multiple gigs to help meet financial obligations while others opt out entirely of traditional 9-5 work for the flexibility and freedom that on-demand work offers them. Economic realities as well as public health concerns will determine how the Gig Economy evolves in future years.