What are the pros and cons of the gig economy? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.Answer by Peter Swaniker, Founder and CEO at Ximble, on Quora:
The explosion of the gig economy continues unabated.
Last year, the Bureau of Labor Statistics reported that 55 million people in the U.S. are “gig workers,” which is more than 35% of the U.S. workforce. That number is projected to jump to 43% by 2020.
If you’ve never heard the term, “gig work” is basically just a buzzy way of describing an independent contract or part-time job, like driving for Uber or freelance copywriting.
Millennials, the generation credited with disrupting everything from housing to marriage, are gravitating towards gig work for the promise of greater work-life balance. Boomers and other generations on the brink of retirement are drawn to gig work because it brings in a little extra income without a major time commitment. And recent technologies like Skype, Slack, and DropBox have made the gig life a reality, giving you maximum freedom, an ideal work-life balance, and the chance to pursue your passions.
If you’re thinking of joining the gig economy, it’s never been easier. But freelance work also comes with challenges, like unsteady workloads and pay schedules, lack of benefits, and a ton of self-discipline.
Here’s what you need to know before you make the jump:
You’re your own boss, so discipline is key.
One of the great things about the gig economy is that you don’t have a boss breathing down your neck.
As a freelancer, you no longer have to cater to a company culture or work schedule that might cause physical or emotional stress. Instead, you get to choose the type of work you do and who you work with. Plus, you get to make your own decisions about when to wake up, when to work, when to exercise, when to run errands, and how much work you take on. You’re able to make choices that suit your personality and unique needs.
But this degree of freedom requires a corresponding amount of discipline, and that doesn’t come easily to everybody.
With no boss to make sure you’re on task, it’s all on you. If you wake up late and miss a client call, no one else can help smooth things over. It’s your responsibility to apologize, call to reschedule or lose the client altogether. Not everybody is suited to be his or her own timekeeper. Some people need structure and the pressure of an authority figure to stay motivated.
But if you’re a self-starter who chafes at being told what to do, the gig life could be a perfect fit.
The gig economy is great for creatives.
The other day, I asked my Uber driver if driving was his full-time job or a side gig. He said he’s a freelance graphic designer and works on projects for clients roughly three hours a day. The rest of his working hours, he drives Uber to keep himself occupied.
When you’re a young creative just starting out, and your resume is more or less a blank slate, gig work can help you get a foot in the door.
The gig economy allows creatives to pay the bills while also giving them time to pursue their passions. Visual artists like my Uber driver can supplement freelance design work by driving for rideshare services. Aspiring novelists can freelance as copywriters to make their rent payments.
Plus, you can do these jobs from almost anywhere. You could be in the North Pole as long as you have internet access. You can find work wherever you feel inspired.
Just make sure your artist’s late nights don’t keep you from turning projects around on time.
You have to continuously up-level your skills and industry knowledge.
The workforce is becoming more advanced and educated by the day.
There’s a high volume of overqualified candidates entering the job market every single year, so landing a job in a competitive field is tough. The idea that you can get a degree and expect to land your dream job right out of college is a thing of the past. You have to keep learning and keep up with industry trends to maintain a competitive edge.
This is true even for people in traditional office settings, but it’s critical if you’re your own boss.
When you go solo, you basically have to sell yourself. And to do that, you have to stay relevant. This means constantly educating yourself—such as by taking online classes or buying the newest trade books relevant to your industry. There is no boss and no established rules to force you to stay up-to-date. The onus is on you. And if you want to keep landing gigs, you have to keep up.
The marketplace won’t wait for you.
You have to get crafty when it comes to traditional work benefits.
Traditional jobs often provide employees with a lot of protections—like health benefits and a 401k.
But if you’re a freelancer, you need to figure out your own retirement plan and buy your own healthcare, both of which can be time-consuming and expensive. Going freelance also means you no longer have paid sick days or vacation time. Every day you don’t work is a day you won’t get paid. And if you want to take a vacation, you have to save up and make arrangements, or otherwise work while you travel.
What I’m saying is, gig work isn’t some magical solution to the tedious office life of the past. It comes with hurdles. If you have health concerns or kids to feed, freelance might not be ideal for you.
But you aren’t without options.
“Multiple Employer” plans, in which a single 401(k) plan is sponsored by multiple employers, is a retirement plan option for gig workers. These plans could be sponsored by states or a group of gig economy companies. Oregon is working on developing a state-sponsored retirement plan that will apply to freelance workers. Both Uber and Lyft offer retirement options to their drivers.
So despite the drawbacks, there are ways to swing it—especially as legislators and companies alike start taking the gig economy more seriously.
It may take longer to build a depth of experience.
Gone are the days where you had a job that lasted a whole lifetime.
Fifty years ago, you’d land your first (and often last) job at a stable company, clock in and out for several decades, and then retire. You usually didn’t have to worry about when your next paycheck would be coming. If you were especially good at what you did, you’d move through the ranks until you climbed to the level of manager—maybe even higher.
And there’s something to be said for having years of experience in a particular industry and developing expertise in that space.
But young people today go into the workforce knowing that their career will likely be in flux. They have to be prepared to keep learning and anticipating trends so they don’t find themselves unexpectedly out of work. A lot of gig workers start their careers by hopping on a project because the employer is desperate and in need of help now. An aspiring chef may fill in when a restaurant’s head chef is out sick. But it’s difficult to develop the skills to become a head chef without stability and mentorship.
In any field, climbing the ranks requires a lot of years of practice and growth.
And on the employer’s end, it’s tough to recruit people for higher management positions when the pool of talent is full of gig workers who haven’t been given an opportunity to hone their skills. Businesses have to evolve to learn how to account for an influx of temporary workers. This means employers must invest in that mentorship and training—such as by having established protocol for gig workers to help them move up the ladder. When companies learn how to thrive with gig workers, everyone wins.
The pace of change in the global workforce is accelerating. To succeed, we have to adapt just as quickly.