Some believe that by the year 2020 40% of all jobs will be part of the Gig Economy. So what is this phenomena and how can you take advantage of it?
It’s all in the name
The “Gig Economy” is a morphed description of old titles like the “peer-to-peer” business model and crowd sourcing. What it refers to is the ability to control when and where you wish to work. Quite like the musicians of old who worked their music gigs, this gig concept is spreading far and wide.
Where the Gig is exploding
|Financial services. Even your savings can be put out on a “gig” service. Places like Lending Source and Funding Circle provide a platform to match lenders with those who wish to borrow your money for a time.|
|Referees and game officials. Want to earn money officiating sporting events? Many services are popping up that allow officials to enter their available schedule and locations they are willing to travel to officiate games. They are then assigned games and paid through the same on-line app.|
Does it work for you?
This new way to match labor supply with demand is becoming more popular. Here are some things to consider before getting too involved in the gig economy.
|Contractor versus employee. Almost all these service companies treat you as an independent contractor. You are responsible for your Social Security and Medicare taxes. You must get your own benefits and send in estimated tax payments.|
|Part-time versus full-time. If you are a recently retired worker, picking up some part-time gigs will keep you socially connected and earn some extra income. Making this a full-time occupation can be more of a challenge.|
|Legal landscape. As the gig economy booms, so does the potential for legislation that changes the landscape. Many local cab companies are trying to squash services like Uber. Local hotels are trying to limit the ability for you to rent lodging. Worker’s liability coverage also needs to be considered if something goes wrong.|
|Urban versus rural. Gig opportunities tend to be located in large metropolitan areas. Depending on this employment for your income in remote areas might be tough.|
The problem the gig economy solves is more readily matching supply with demand. This puts the old business models at risk. Anticipate more attention in this area as legislative action tries to balance the power of this new job creation device with a dramatic redefinition of employment no longer centered within vast company payrolls.