Who Are the Winners and Losers in the Gig Economy?
Diane Mulcahy shares an article published in the Harvard Review that explores how the indicators of success in the gig economy are changing.
The winners and losers in the U.S. economy have traditionally been easy to identify. If you had a full-time job, you won. A full-time job provided the steady income needed to support our traditional version of the American Dream: the highly leveraged, high-fixed-cost house; the cars; the latest consumer goods. A full-time job was also the only way to access important employer-provided benefits, such as health insurance and a pension, as well as protections against workplace injuries, discrimination, and harassment. Without a full-time job, a true sense of security was elusive, benefits were inaccessible, and you were more likely to be stranded on the fringes of the labor market, observing rather than living the American Dream.
All of that is changing. Work is being disaggregated from jobs and reorganized into a variety of alternative arrangements, such as consulting projects, freelance assignments, and contract opportunities. Independent workers can obtain health insurance and save for retirement without an employer, thanks to the Affordable Care Act, individual 401(k)s, and individual retirement accounts. The American Dream is transforming to prioritize experiences over material goods and quality of life over quantity of stuff. Most important, the absence of job security opens up new possibilities for a portfolio of gigs to provide a more meaningful and robust sense of income security than any full-time job can.
As the jobs-based economy gives way to the gig economy, winners and losers are determined by the type of worker you are — or can become.
Workers with specialized skills, deep expertise, or in-demand experience win in the gig economy. They can command attractive compensation, garner challenging and interesting work, and secure the ability to structure their own working lives. Workers who possess strong technical, management, leadership, or creative abilities are best positioned to take advantage of the opportunity to create a working life that incorporates flexibility, autonomy, and meaning.
Entrepreneurial workers also win. The gig economy rewards hustle. Workers entrenched in a passive, complacent employee mindset that relies on their employer to provide a sense of stability, career progression, and financial security will struggle. Independent workers who are comfortable with and excited about developing their own income streams, marketing themselves, and connecting with others are best positioned to take advantage of the many opportunities the gig economy offers.
Key points include:
- Skilled and entrepreneurial workers
- Bad jobs
- Marginalized workers
Read the full article, Who Wins in the Gig Economy, on hbr.org.