A grad student who drives for a taxi aggregator in his spare time, a stay-at-home parent who earns extra money with a part-time job, and a high school student who chooses offbeat jobs over food delivery apps. Labor economics is widely touted as the last great phase of modern work, whether as the latest innovation in working life management or as a massive new industry that will replace traditional labor relations.
The rise of the gig economy
With the advent of the digital age, today’s workforce is becoming more mobile, with the freedom to work anywhere, which is seen as one of the main reasons for the boom of the gig economy. As a result, we have a generation of people with more options available to them. The gig economy refers to an increasing global growth in the number of gigs, contracts and casual jobs in place of traditional full-time employment. Examples of gig workers include freelance writers, online tutors, digital marketing experts, web developers, cybersecurity experts, and many others.
In an on-demand economy, temporary and flex jobs are common, and companies are inclined to hire independent contractors and freelancers rather than permanent employees. The gig economy has been around since companies started hiring temporary or seasonal workers. One of the benefits of the gig economy is that workers can work in low-intensity jobs while upgrading their skills to fill in-demand positions.
What this means for today’s generation of employees
A study by Niti Aayog on “India’s Booming Gig and Platform Economy” estimated that in 2020-2021, 77 lakh (7.7 million) workers were engaged in the gig economy. According to the report, the gig workforce is expected to grow to 2.35 crore (23.5 million) workers by 2029-30. Currently, around 47% of gig work is in medium-skilled jobs, around 22% in high-skilled jobs, and around 31% in low-skilled jobs. The trend shows that the concentration of medium-skilled workers is gradually decreasing and that of low-skilled and high-skilled workers is increasing. It can be expected that, even if the dominance of medium skills continues until 2030, gig work with other skills will emerge.
Gig employees can spend more time learning new skills than traditional workers because they can work in low-intensity jobs while learning complementary skills. From a worker’s perspective, a gig economy can improve work-life balance compared to many traditional jobs sought by most millennials and GenZers. According to various studies over the years, gig workers are happier, and happier workers tend to be more engaged in their work (which increases productivity), leading to lower absences and turnover. The gig economy empowers workers by giving them flexibility in planning and structuring their days so that they maximize their work and life potential.
The rise of the gig economy greatly benefits the new generation of employees, providing new job opportunities and multiple sources of income, as gig workers can hold multiple jobs simultaneously. Speculation is that the gig economy will grow substantially in the coming decades – and with good reason. With the rise of freelance apps and a growing jobs crisis, on-demand jobs are becoming more desirable and available to a generation of tech-savvy millennials.
In India, there are 15 million gig workers employed in industries like software, shared services and professional services, according to a report. Waves of social media buzz make a compelling case for the viability of gig work. A growing number of freelancers are becoming more comfortable with the gig economy, with maximum people feeling more financially secure. The findings reveal just how financially dependent people are on the gig economy, with many forced to take on-demand jobs on top of regular employment to make ends meet.
The majority workforce is made up of Millennials and Gen Z, who will choose on-demand work over a more traditional full-time office environment at all times, and so employers are trying to accommodate these changing needs and appetites.
The opinions expressed above are those of the author.
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