Pros and cons of joining the gig economy

With the everchanging environment of the labour market, businesses are constantly evolving to meet clients’ different needs and one of the biggest trends to affect the workforce is the rise of the gig economy. The advancements of tech have opened a new market where freelancing and side hustling are common means of earning a crust. The emergence of Uber, Deliveroo, and Upwork may be creating new opportunities for employment to some young people but they bring new challenges too.

So, what are the pros and cons of joining the gig economy in Australia?

Pros

Flexible working hours

Workers have expressed their demand for flexibility in the workplace and to no surprise, it’s one of the reasons for the rise of the gig economy. In today’s work environment, there are jobs in the market that doesn’t need workers to perform repeatable tasks. This provides freelance workers an opportunity to fill these gaps and grant themselves the flexibility to work for multiple different companies. From working remotely at home, to working whenever they want, there are plenty of options for freelance workers.

Supplementary income

Joining the gig economy can be a great way to earn some extra cash. Some gig workers, like contractors and freelancers, can decide how much they charge for their services. According to the Australian Government Business, a contractor’s service rate should cover costs like insurance, tax, superannuation and other work-related costs. Gig workers work generally with a client on an hourly rate and sometimes they might work with agencies or even on their own.

Variety of jobs

Many small businesses often favour outsourcing external employees as these companies can reach a diverse pool of flexible and talented workers. With the help of gig workers, it makes smaller companies and start ups to quickly scale their business. Most of the time, gig workers come in to provide expertise in a certain role or a project as they’re more skilled to perform a specific task.

Cons

Job insecurity

Although gig workers have a chance at flexible work hours, they’re at risk at maintaining a stable job. In Australia, under the Independent Contractors Act 2006, contractors are protected from adverse action, coercion and abuse of freedom of association. Although being a contractor does come with a level of security and safety, casual workers get minimum entitlements compared to full time employees, this means that employers have the right to terminate their services at any moment.

Delayed or minimum income

Being a freelancer is great, you get to plan your schedule around and decide how much your work is worth. However, in this scenario, being your own boss doesn’t mean you get paid on time. Ongoing employment as a freelancer is rarely guaranteed and to make good money, freelancers must hustle hard to find ongoing work and clients. Unlike a traditional job, your income will vary across the year depending on the number of hours you’re working and projects you take on. Every casual worker should be prepared for the inconsistent stream of income they’ll face.

No benefits

There are certain perks that full-time employees get that gig workers don’t – and it’s one of the main reasons why most employees prefer full-time roles. One of the downfalls of being a contractor or freelancer is that they’ll miss out on employee benefits such as paid leave, superannuation and even proper training. Unfortunately, casual workers are stuck figuring out how to financially plan their money when it comes to dealing with insurance, tax or super.