Gig economy: Pros and Cons

Several firms in the gig economy have expanded operations during the Covid-19
pandemic. This has been made possible by the ready availability of an at-risk labor
force. Fashioned as ‘aggregators’, gig platforms shirk responsibility for worker safety &
welfare.

What is Gig Economy? Let’s have talk about gig Economy

The term “gig economy” refers to a free market system in which traditional businesses
hire independent contractors, freelancers, and short-term workers to perform individual
tasks, assignments, or jobs. The term comes from the world of the performing arts in
which musicians, comedians, etc. are paid for their individual appearances, called
“gigs.”

How the Gig Economy Works

In the “gig economy” or “freelance economy,” gig workers earn all or part of their
incomes from short-term contracts under which they are paid for individual
tasks, assignments, or jobs. Typified by globally-recognized companies like
Uber, and Lyft—which hire people to use their personal vehicles to provide taxi-
like, on-demand ride services—gig economy companies use internet and
smartphone-based applications to both hire and assign workers.

Each individual gig or assignment usually accounts for only a part of gig
worker’s total income. By combining several tasks for different companies, gig
workers can realize cumulative earnings equal to those of conventional full-time
jobs. For example, some gig workers drive their cars for both Uber and Lyft,
along with renting out rooms in their homes through Airbnb. Other people
simply use gig jobs to supplement their regular income.

Another aspect of the gig economy involves so-called “digital earning platforms,”
like eBay and Etsy, which allow people to earn money by selling their used items
or personal creations, and online handyman services, like TaskRabbit.

For employers, the gig economy is mostly a win-win proposition. Businesses are
able to quickly contract with experts for individual projects without the overhead
costs like office space, training, and benefits. For freelancing gig workers,
however, it can be a mixed bag of pros and cons.
So, let's have view on Pros and Cons of Gig Economy

Pros of Gig Work

Flexibility:
Unlike traditional employees, gig workers are free to choose what types of jobs
they do and when and where they do them. The ability to work from home helps
in balancing work and family schedules and demands.

Independence:
For people who like to be left alone while they complete an assignment, gig work
is ideal. Not hindered by traditional office interruptions like staff meetings,
progress reviews, and water cooler gossip sessions, gig economy workers are
typically given almost unlimited independence to do their work when and how
they think it should be done.

Variety: 
The old office bug-a-boo of monotony is rare in gig work. A wide variety of tasks
and clients every day keeps the work interesting, helping gig workers be more
enthusiastic and creative in their work. Never a dull day in gig work—unless you
want one.

environment of competition
The gig economy has started the environment of competition and efficiency among the
workers. The recruiters get some freelancers on board, and a healthy competition is
promoted among them for extra money for the best performers.

Cons of Gig Work

Modest Pay:
While they can make as much as $15,000 a year, a study by online lender
Earnest found that about 85% of gig workers make less than $500 a month from
a single side-job. The solution, of course, is to take on multiple gigs.

No Benefits:
Very few gig jobs come with any sort of health or retirement benefits. While
some long-term contracts may come with limited benefit packages, even this is
rare.

Taxes and Expenses:

Since contract gig workers are not legally classified as “employees,” their
employers do not withhold income tax or Social Security taxes from their
paychecks. As a result, gig workers must make quarterly estimated tax payments
to the IRS based on what they have earned. Most freelance and gig workers find
the need to pay from 25% to 30% of each of their paychecks in order to avoid
owing taxes at filing time. In addition, most gig workers are responsible for
buying their own work-related equipment like cars, computers, and
smartphones. While some of these expenses can be deducted from taxes, not all
can be. Many gig workers find they must also factor in the cost of accountants or
tax preparation services or software.

Stress:
All of the above, along with the need to constantly be looking for their next gig
and dealing with changes in their current contract can make for increased stress
—an undesirable trade off to the greater flexibility of gig work.

In Conclusion I would say

The gig economy has excellent sides to it, but also has a pretty volatile side too. Some
people thrive well from this system, while others find it a challenge. That’s why The gig
economy is ever-growing.