What Stands Behind the Growth of Gig Economy?

What Stands Behind the Growth of Gig Economy?

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What Stands Behind the Growth of Gig Economy?

What Stands Behind the Growth of Gig Economy_

2020 saw a massive shift in many parts of business and hiring. The use of virtual platforms for work spiked, as did the flexibility that working from home offered.

Moreover, shifts across numerous industries have been prevalent even into 2021, with no signs of stopping. More blue-collar workers than ever are shifting over into the world of gig business models. While this model was once considered volatile and unpredictable, it has proven stable enough for sustained income. Over 57 million Americans are currently doing some type of gig work. The infrastructural change has most certainly been noticed at this point, creating an economic atmosphere that could lead to many future opportunities for savvy business leaders. It is crucial to understand how the current atmosphere came to be to understand these economic shifts clearly. 

First of all, how did all of this happen so suddenly? 2020 was a year rife with many chaotic events. With the massive migration to “work-from-home” practices, one of the unforeseen byproducts was a reluctance for many employees to return to previous conditions. Issues of safety were primarily responsible given the state of the pandemic, however, so too was the dissatisfaction of employees themselves. Having proven that working from home was viable, sustainable, and even beneficial with an average increase in productivity of 51%, employees were no longer willing to return to archaic models. Because of this, the correlation between workers choosing jobs that allow for greater flexibility as well as the decrease in blue-collar markets can’t be ignored. In that regard, neither can the availability of government stimulus programs, allowing for safe and secured incomes to those searching for a different vocation more suited to their individual needs. For the most part, these circumstances allowed the current blue-collar crisis to be largely ignored until recently, when an abrupt shortage in the global economy came at a time when a resurgence in the workforce was expected. 

A massive void in blue-collar jobs has only continued to expand with the shortage of employees returning to traditional working environments. As of October 20th, the US Department of Labor Statistics reports that worker “quit rates” have only increased since the 10.2 million job vacancies of August were announced, resulting in 4.3 additional vacancies since. Among these jobs are what are widely considered traditional “trade skill” jobs, such as plumbers, electricians, machinists, roofers, construction workers, and more. A recent decline in these trade skill jobs has been linked to the surge of IT and tech vocations that have seen greater demand in the last decade. However, with 2020 came a resurgence in demand for such aforementioned jobs, most of which remain unfilled. So, what jobs are former employees turning to? They are picking jobs that offer the greatest flexibility and incentive for maximum return on their invested time: the gig model. 

Gig models such as Uber, Instacart, Lyft, and Doordash saw massive demand increases during the onset of the pandemic, not only allowing restaurants and other businesses to continue sales and distribution but catering to the needs of many new stay-at-home employees. A proverbial “perfect storm” of conditions with the pandemic, numerous shutdowns on an international scale, and many workers looking for viable and sustainable jobs with preferred flexibility have all contributed to the massive rise of these industries with no sign of change. As the months progressed, gig markets only continued to thrive, increasing by 14% by the end of 2020. These numbers are only expected to increase in 2021 and beyond, predicted to gross over 455 billion dollars globally by the end of 2023. In the US alone, over 44% of the workforce consider gig work to be their primary income source, with over 60% engaging in freelance work weekly. In fact, gig work in the US currently contributes 1 trillion dollars annually to the national economy

With higher satisfaction rates, a surging demand that’s only expected to increase, and a robust supply of readily available applicants, it’s safe to say that gig work is here to stay. While the future remains unknown for any industry, models such as the previously listed gigs have shown resilience and adaptability along with their broad appeal to a workforce looking for a change. However, through it all, the question of any prospective employer remains: what opportunities can be found amidst the current climate? 

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