The Gig Economy: Pros and Cons

More than one in 10 working Americans have joined the so-called gig economy, working as freelancers or independent contractors, according to a survey of 1,008 people from ReportLinker. A third of respondents said they would consider exiting the traditional workplace to work in the gig economy, while nearly half said they would be willing to consider doing so within the next three years.

Why would so many consider giving up the security and benefits of a full-time job for the uncertainties of gig work? Twenty eight percent of survey respondents cited “being your own boss,” while the ability to work flexible hours came in second. Nearly 40 percent of job seekers say they’d consider becoming an independent contractor, as would 59 percent of part-time workers and 33 percent of students, according to the survey.

The lack of benefits is a drawback for those working in the gig economy, however, with one in four of the respondents who work as freelancers citing the lack of retirement benefits as a downside. Indeed, the lack of traditional job benefits such as sick-leave pay and unemployment benefits has led the United Kingdom to appoint a team of four experts to review the impact of “disruptive” businesses such as Uber and Deliveroo on that nation’s workforce, reports the BBC. The panelists include Matthew Taylor, chief executive of the Royal Society for the Arts.

“One of the key issues for the review is ensuring that our system of employment rules are fit for the fast-changing world of work,” Taylor writes in a piece for the Guardian newspaper.

“As well as making specific recommendations, I hope the review will promote a national conversation and explore how we can all contribute to work that provides opportunity, fairness and dignity,” he told the BBC.

The lack of benefits typical in most gig economy jobs has resonated Stateside as well, of course, with a number of gig workers filing suit alleging that they’re actually employees, not independent contractors, and are thus eligible for benefits such as unemployment compensation. In response, companies that employ freelancers are pushing for bills that promote “portable” benefits that workers would be able to take from job to job. Online home-cleaning company Handy, for example, is circulating a draft bill in the New York State legislature that would establish guidelines for portable benefits for workers in that state’s gig-economy companies, reports Reuters. The bill would classify workers at companies choosing to participate in the program as independent contractors rather than employees under state law, as long as the companies’ dealings with their workers “meet certain criteria.”

Not all are pleased with the bill. Larry Engelstein, executive vice president of 32BJ Service Employees International Union, criticized it as offering workers too little.

“The amount of money that’s supposed to be put into these portable benefit funds seems so meager,” Engelstein told Reuters. “The actual benefit a worker is getting hardly warrants what the worker is giving up.”