The gig economy is on the rise and with it comes great flexibility that more entrepreneurs are opting for it every day.
We asked entrepreneurs the impact this had and here are the insightful responses.
#1- Personal impact
I spent a year working gigs on Fiverr as a translator, WordPress tech support and building webforms using MailChimp, google forms, etc.. It’s really underpaid labor, but it did help me get the funds needed to set up my own thriving webshop. The webshop is running smooth now and I don’t need Fiverr anymore for financial support. In fact, I closed down my Fiverr account just last week.
Thanks to Dennis Michels, Good Look Gamer!
#2- Reduced availability of quality talent
In my opinion, the gig economy has massively reduced the availability of quality talent in the market and has driven organizations supplying more traditional forms of employment to increase offered remuneration to continue to attract a quality workforce. This trend towards ever higher compensation for top performers increases *financial pressure on organizations, especially smaller businesses who can experience substantial financial pressure on the back of a relatively minor increase in salaries!
Thanks to Ollie Smith, ExpertSure!
#3- Two impacts
The gig economy made it possible for us to get our business off the ground. It empowered us to take on top talent for minimal hours, which have now scaled up to over 20 part-time freelancers working for us and no full-time employees.
Thanks to Jeffrey Cammack, FXScouts!
#4- Good and bad aspects
What’s great about the gig economy is it allows anyone to start a small side hustle, to earn money outside their 9 to 5 job, etc without time constraints and unnecessary risk ie quitting your day job that may have been required in the past to be self employed or start a business.The downside to the gig economy is it’s driven the cost of labor and wages and gigs down substantitally. Quality service providers can still stand out, however when people can buy a gig on Fiverr for $7, odd I know that a site called Fiverr sells $7 gigs, that drives down the wage of freelance writers, graphic designers, etc. When we talk about the gig economy I personally think of starting small businesses, selling on ebay or amazon, starting a service business, doing a freelance service, however the media often portrays gig economy as driving Uber or Lyft. Those types of gig economy jobs I suppose are good if someone is just looking to make a couple bucks to cover a rent shortfall, however I don’t care for those as they don’t pay well, they are not scalable and it’s not something that has any chance of growing into something larger or an actual business.
Thanks to John Frigo, MySupplementStore.Com!
#5- Continue to flourish
The gig economy is having a huge impact on business. The “gig economy” is all about adding maximum value to an organization at the optimal time. Consultants and contractors often have deep subject matter expertise. They can join an organization and take on initiatives that the company lacks the knowledge or bandwidth to address. There exists understood flexibility on both sides. As long as the number of opportunities continues to grow in number and value transfer on both sides is balanced, the ”gig economy” will continue to flourish.
Thanks to Juli Lassow, JHL Solutions!
#6- Cost saving
The gig economy has created a huge opportunity to grow a virtual workforce. Instead of spending thousands of dollars renting office space and furnishing them with desks, chairs, printers, phones, and the multitude of paper clips, business owners can hire remote employees and contractors from their own homes. Many millennials value the flexibility to work on their own schedule and from their own homes, by offering positions that allows for that can create substantial savings on what used to be fixed costs for rent and utilities. Another major impact is the cost savings from payroll taxes and benefits. Many in the gig-economy enjoy the flexibility and freedom contracting gives them. As a business owner, that saves big bucks where they’d otherwise be paying for benefits and half of their FICA taxes.
Thanks to BenWatson, DollarSprout!
#7- Paving the way for more entrepreneurs
The impact of the gig economy, as I have seen it, is that it is paving the way for more people to become entrepreneurs. Many individuals pursue side hustles centered around hobbies or interests they are passionate about. More often than not, these side gigs grow and quickly become full-time roles with steady revenue and a strong client base. This allows individuals to leave current full-time positions they may be less invested in to take their side hustle full-time and become an entrepreneur. I think the gig economy is awesome because it allows people of all ages to keep pursuing areas that interest them, keep learning and growing, and eventually create successful small businesses that aid to the economic backbone of the country.
Thanks to Deborah Sweeney, MyCorporation.com!
#8- Short-term relationships
Digital platforms make offering and taking work with phenomenal flexibility a reality. But often that flexibility is one-sided, and that’s a recipe for short-term relationships. Whether you are hiring or for hire, you surely want a go-to reputation to attract and keep good performers who can drive up the value of business through their skills and experience. That’s going to cost more than minimum wage and require transparency and honesty in sharing what is needed by each party. But in my experience, that time and money is a sound investment.
Thanks to Simon Sapper, Makes You Think!
#9- Business growth
One of the biggest impacts of the gig economy on our business is an ability to contract short-term remote workers globally. It can be tough to compete for local full-time employees with other Silicon Valley companies, but having an opportunity to hire contractors from all over the world for short-term jobs definitely helps our business. Moreover, since we understand the importance of gig economy on the modern world, our company actually develops certain IT-products that are oriented specifically towards gig economy jobs.
Thanks to Vlad Krishtop, Konstruktor Service!
#10- Need for clarity
A big impact of the gig economy on businesses is a greater need to clearly define the requirements, responsibilities, and expectations from each role, especially the role intended to be filled by the gig worker. Owners and entrepreneurs must be extremely conscientious about the assignments they give to contractors and consider how key objectives can benefit from specialization provided by the gig worker. Business leaders are also feeling the impact of the gig economy on their culture, determining if contractors will be integrated into the team or treated as a commodity.
Thanks to Jethro Lloyd, iLAB!
#11- Changing the way things are done
The way many people work and the way many companies manage, address and access their talent needs has changed over the past several years. The ranks of independent consultants, gig-by-gig professionals and freelance workers has exploded into the millions. One of the fastest growing segments of independent workers is at the executive level who earn over $100,000 a year (per Fast Company Magazine April 2019). We’ve built a brand and team of 15,000+ who are working on-demand for clients in nearly every industry and function nationally, as well as with a global reach. We built an online community dedicated to this group and their special interests and needs – insurance, retirement savings, training. (PatinaNation dot com). Business are responding very well; they are hiring the exact, skilled talent required for as long as needed to reach their results. The gig economy is a game changer.
Thanks to Mike Harris, Patina Solutions!
#12- Win-win solution for the employer and the employee
I personally believe the gig economy will continue to evolve as the prominent, if not the main way we do business in the future. When properly executed, the gig economy will give a win-win solution for both the employer and the employee, economic-wise. Since more people will be available for the task, the cost will be lower to hire a worker. On the other hand, the worker can take more jobs compared to if they are tied to a single company, meaning, more income. Management-wise, however, gig economy can be a significant challenge. Most managers and c-suites are not used to managing people outside the organization (and in a lot of cases, even outside the country). New performance measurement metrics should be placed, and managers must learn and apply new approaches to manage and monitor these workers.
Thanks to Steve Kurniawan, Nine Peaks Media!