THE FUTURE OF THE GIG ECONOMY

Why the Future of the Gig Economy May Not Be What You Expect

 

The ‘gig economy’ has gotten a lot of press lately; in fact, we even covered it on Smart Hustle recently. What we know is that the gig economy (or on-demand economy) consists of workers who provide on-demand services. Things like freelance writing to car sharing. Some experts predict that by 2020, 40 percent of Americans will be part of this unique workforce. This means that job seekers, business owners, and even the U.S. government all have a vested interest in staying informed about the gig economy.

However, many questions still remain about the viability and impact these type of workers will have on the overall economy, which has caused everyone from the Bureau of Labor Statistics to Intuit to launch studies to learn more. We reviewed a recent study that came to us from Thumbtack, an online platform that connects consumers with skilled professionals such as handymen, housekeepers, tutors, photographers, and more, to see what insight they had to offer on the future of the gig economy.

Beyond the Gig Economy

The Thumbtack report broke down one assumption about the gig economy – namely that it is a homogenous group. According to Thumbtack, the gig economy consists of two distinct categories of workers. They are:

Skilled Professionals:

People with vocational skills and a passion for building long-term, self-sustaining careers. They find work via online marketplaces such as Thumbtack, Fiverr, and Upwork and offer services that range from business assistance like web design and copywriting, to consumer services like cleaning, carpentry and fitness training.

Low-Skilled Workers:

People who have low-level skills or resources that they use primarily to make extra money without the intent of making a career out of it. They find work on commoditized platforms (like Uber, InstaCart, Airbnb) and provide low-level skills such as car driving and grocery shopping.

So if there are two categories of workers in the gig economy, which one holds promise for the future? Here's what their study concluded:

“The skilled professional is the real future of the gig economy and is a sharp contrast from the low-skilled ‘gigs’ that currently receive so much media attention. It is important that policy makers, tech companies, and workers come together in support of this growing class of small businesses and individual entrepreneurs.”

Why Skilled Professionals Are the Future of the Gig Economy

Thumbtack backs up its conclusion that skilled professionals, not low-skilled gig workers, are the future of the gig economy with several convincing points, including:

  • Automation puts low-skilled gig jobs at risk. No one will need an Uber driver once we have driverless cars. Similarly, we won’t need people to deliver groceries or packages once we have package delivery drones. On the other hand, jobs done by skilled professionals will be resistant to both automation and outsourcing.
  • Low-skilled gig jobs also tend to be location-specific. While these jobs are currently popular in major cities, they aren’t used as much in smaller cities, towns and rural areas. On the other hand, skilled professional marketplaces open job opportunities no matter where the person lives.
  • Paths are opening for career-driven skilled professionals. Technology and current laws are making it simpler for them to find work and to go out on their own. Skilled professionals can also make more money, even without a college education, and they report higher job satisfaction than the general working population.

All in all, the Thumbtack report suggests that while the media may be abuzz about the gig economy, it is really the skilled professionals that we should be focused on. This segment of the gig economy is likely to grow in the future while those low-skilled gig jobs fizzle out.