While remote working has gained popularity and societal acceptance during the pandemic, working from home is far from a new concept. In fact, IBM had 2,000 remote workers over forty years ago. And from there, its popularity has continued to grow. Freelancers and digital nomads are enjoying the benefits of the gig economy and will ensure remote work is here to stay.
The future of the gig economy is exciting as new opportunities emerge … [+]
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Businesses that encourage remote work are also benefiting. You can reduce operational costs associated with rent and utilities, and foster more productive and inclusive work environments. Additionally, remote work can improve the recruitment process as it opens the door to more applicants and has been shown to significantly reduce turnover.
Despite these employee and business benefits, some organizations are still focused on the challenges within the gig economy, particularly around employee engagement. Executives wonder how to monitor performance and increase productivity of employees they rarely, if ever, see in person. I spoke to Wayne Goshkarian, Founder and President of Dylan Consulting, to get his perspective on the gig economy.
Jeff Fromm: The gig economy is exploding. What is the attraction for people to work in the gig economy instead of the typical nine-to-five?
Wayne Goshkarian: Independence is the main reason for working in the gig economy.
In a traditional setting, employees have expectations to live up to and a boss to whom they are accountable. Gig workers have the freedom to choose their schedules, choose work that interests them, and get things done in their own unique way. This prepares them for a better work-life balance.
Gig work can range from working as an independent contractor (e.g. driving for Lyft and Uber) to setting up a shop on Etsy. Many see it as a simple, easy, and affordable way to generate extra income, which becomes a full-time job for many. These types of workers can pursue a passion or simply enjoy the privilege of choosing their own job. In any case, gig workers have an entrepreneurial heart and are usually highly motivated.
It also appeals to a wide variety of people. Single parents, for example, can use gig work either as a balance to their children’s everyday school life or as a side income for childcare. Generation Z, who grew up with technology, also see the great income potential at their disposal. The internet and smartphones are enabling the gig economy to thrive today, and many individuals can quickly start and promote a business.
Religious: What are the benefits for employers when hiring gig workers? And how do these workers benefit from being classified as gig workers?
Goshkarian: Hiring a gig worker has many benefits. They are considered independent contractors, which means you can hire them based on your needs. Employers can manage workload through on-demand requests, reducing the cost of goods and services. It can also be very cost effective since you don’t have to provide employee benefits like 401K, health insurance, paid time off, etc. for every gig worker you hire.
Gig workers are like entrepreneurs and reap similar rewards. It is much easier for them to live their lives as they see fit. They benefit from this placement because they can schedule their own hours and have the flexibility to work on new projects that excite them. You don’t have to worry about getting fired when you’re your own boss.
Religious: How does the Association for Entrepreneurship USA support gig workers?
Goshkarian: Gig workers need support. Because they don’t receive the same perks as a full-time employee, receiving benefits can become costly. AFEUSA has mass guaranteed insurance products from companies such as MetLife, Zurich, Chubb, Equitable, Crum & Forster and Prudential to name a few. AFEUSA also built an “Amazon-like” online registration system for these members to gain access to these programs.
AFEUSA provides education, networking opportunities, and resources to give entrepreneurs the essential tools to grow their business. For example, in March we partnered with Dylan Consulting for our annual focus group event in Pebble Beach. There we will talk about how to address the exploding gig economy in the health insurance industry.
The AFEUSA website contains informative articles designed to help entrepreneurs succeed in business, with guides on how to properly plan a marketing strategy, advice on picking up gig work during the holiday season, and how to generate relevant and consistent leads. AFEUSA guides entrepreneurs on how to get a domain, form an LLC, and take other basic steps to get their business up and running.
Religious: How do you predict the future of gig work?
Goshkarian: The gig economy is here to stay. Gig work offers long-term flexibility for people to earn an income ($500-$2,000 per month) with little to no investment. After the big resignation, many people are wondering where the workforce is going. The answer is that many workers are transitioning to gig work. According to a study by Upwork and the Freelancers Union, a majority of the US workforce will be freelancers by 2027.
Since the COVID-19 pandemic and quarantine, people have learned to work from home and enjoy flexible working hours. Now the world has become our office. You can work for a company in the United States while traveling in Europe. Many people, like me, have chosen to reside in multiple places because our work allows us to do so. As technology advances, there will be more opportunities for people to work remotely.
While gig work is perceived as something for the younger generation, it can also be a great extra income for those of retirement age. With inflation, many retirees are taking up gig work to support their lifestyle. In the future, even more retirees could do gig work to boost their fixed income.
I expect the workforce will gravitate toward more gig work, small businesses will continue to thrive, and many will choose to work for themselves.
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