It is undeniably true that there are pros/advantages you can find within the gig economy, which will encourage you to invest your time, skill, and effort in it. But, there’s always a list of disadvantages that comes with the advantages, don’t they? There’s always another side to the majority of everything, just like a coin that has two visible sides, so is the gig economy.
The gig economy is known for its ecosystem where most of the jobs are done with the use of the internet. Because of this feature, it became more popular among the younger demographic: millennial and Generation Z people are mostly the runners in the gig economy. According to Edison Research, gig workers are more likely to be young , with 38% of 18–34 years old being part of the gig economy.
It is no surprise that teenagers starting at 18 are beginning to develop their interest in working and finding their future career path while testing the waters. This age of exploration can help them in so many ways, that’s why this article is here to give a little insight into the disadvantages of the economy they are most likely to get interested in. If you are a starting young adult that wanted to hop into the world of the gig economy, you might wanna read this article to help you get ready for what you will be facing when you become a gig worker.
We have here 5 cons/disadvantages in the gig economy:
1. Lack of benefits
Freelancers/Independent contractors in the gig economy are not considered “regular” employees, meaning that they are still exempted from the company’s benefits for its regular workers. There are different benefits when it comes to gig workers, but not as many as the ones working full-time. So if you are considering having jobs where there are lots of benefits gained, then you might want to consider bailing out of the gig economy doors. It is not a bad thing to expect more from the company or platform you will be working for, given the fact that you want to offer your full capacity, but you should choose what you want. You hold your decision.
2. Gig worker’s expenses/ personal expenses
In the gig economy, gig workers are usually responsible for their personal expenses or out-of-pocket expenses used for working; for example, laptops, phones, internet, phone plan, gas, etc. Gig workers usually cover their own expenses regarding their job/work.
Every worker is entitled to be stressed at their work/jobs, but it is said that gig workers tend to have more stress because they are working only to find other gigs again to keep their workflow steady. Jumping from one gig to another may be stressful because of the changes that you might undergo. Sometimes, gig workers experience massive and sudden changes in their jobs, such as being dropped out/let go or a decrease in their salary. If you want to join the gig economy, you need to consider the stress it may bring you, as you are not a regular employee.
4. Feeling of Isolation
If you are the type of person that finds associating with people comfortable and builds connection easily, you might wanna consider being a gig worker. Unbelievable it may sound but some gig workers find working remotely or from home very bland, as they don’t go to the office to mingle with other workers. Introvert workers may find this appealing but it is certainly not for everyone. Being an independent worker means you get to do the job tasked to you, on your own. For some, this kind of setup is motivational and not cluttered, but for many, it can cause isolation and social anxiety, which can greatly affect the mental health and productivity.
5. Unbanked situation
Since it’s the gig economy, many workers get paid after they completed their task and all, payments in the mode of cash, bank transfer, etc. But, the point is that many freelancers/independent contractors are still outside of the bank hemisphere. Most of them are not serviceable by bank, specially on the younger demographic (generation z), since they are working as freelancers, chances are most of them are part of the unbanked population. Maximizing the use of bank services can be a great help to you when it comes to your payments, money transfers, and can be handy especially when it comes to jumping from one gig after another. You need to consider these things before you jump into the gig economy, you need to at least find yourself a payment solution that will help you cover bank services, digitally.
If you’re already in the gig economy/planning to be in the gig economy, still unbanked, and wishing to accept payments online, Piccopay got you covered;visit us at piccopay.sg for more information.
“Gig Economy.” Corporate Finance Institute, 24 Feb. 2022, https://corporatefinanceinstitute.com/resources/knowledge/other/gig-economy/.
Western Governors University. “The Pros and Cons of the Gig Economy.” Western Governors University, Western Governors University, 29 Jan. 2021, https://www.wgu.edu/blog/pros-and-cons-gig-economy1808.html#close.