The gig economy has vastly grown over recent decades. The name might bring about the idea of rock stars in your local pub, but it actually offers a range of flexibility that traditional working models don’t – or didn’t. As of 2022, it was estimated that around 4.4 million people in the UK were gig workers and that number has been growing by around 14% every year. And yet, Labour isn’t a fan. The government party supposed to represent the working class has promised to rage war on the concept during their election campaign. So, what are the benefits and drawbacks of being a gig worker? Should you think twice before committing to a job in the gig economy? We explore here.
Scope of the gig economy
To really get an idea of how prevalent the gig economy is, roughly 1 in 7 adults in the UK are engaged in some form of gig work. As mentioned, the number of UK workers who are self-employed has steadily risen over the past few years, contributing to the rise of the gig economy. In particular, the hospitality industry has boomed with delivery services like UberEats and Deliveroo, transportation with Uber, and creative professional services like copywriting and graphic design led by platforms like Fiverr and Upwork. However, we can’t forget the industry as old as time: trade work.
According to the Office for National Statistics, in 2023, gig workers contributed £20 billion to the UK economy, and they predict that by 2026, the number of gig workers will almost double.
What does Labour want to do?
In the campaign green paper, Labour’s Plan to Make Work Pay – Delivering a New Deal for Working People, the Labour Party outlines plans for shaking up how we all work, but one of their main targets is the gig economy, which they see as unstable for workers. As the concept grows in popularity, it’s easy to see why businesses are outsourcing to freelancers in various sectors, which, in turn has caused Labour to consider stricter regulations.
The first step of stabilising the gig economy is for Labour to establish a legal definition of “self-employed”, “worker” and “employee” and bring them under the two banners of “self-employed” and “employee”. That means freelancers and independent contractors would be legally considered employees and have the same rights as employees, namely that they could no longer be unfairly dismissed.
Another thing that Labour wants to look at is zero-hour contacts. The concept of no minimum required hours for the worker offers no job security, as workers have found themselves going weeks without work, creating issues of no minimum amount of income.
All of this and other drawbacks from the gig economy we will go into, has created a market that can be very exploitative. Benefits, security, and stability are concepts that can be very foreign to gig workers and are all areas that Labour has promised to regulate.
So, what are the benefits of being a gig worker?
It’s important to remember that Labour isn’t against the gig economy as a concept. It can be a great way to get by, whether that’s to fill a gap in a CV, on the side, or simply a vocation you’d rather do yourself. And when there are constant complaints about the state of the job market right now, it can be a lifeline to simply do it yourself.
You’ll gain from flexible working hours and the ability to work from home without anyone trying to get you back into the office, you’ll be in charge of your own projects and clients, and you can work as much or as little as you want, with income coming from multiple streams.
And what are the cons?
However, being a gig worker pushes the responsibility of the job from the employer, onto the worker. Concepts that the employer would usually handle, nay, ensure, like job security, benefits and standard income, are now the responsibility of the worker.
These aspects are what Labour is trying to tackle. For instance, the benefits gap suffered by gig workers is in the firing line is in Labour’s sights. Gig workers are likely to gain less in pensions, and no health insurance.
One particular move Labour is suggesting is to redefine the definition of “workers” so that they have the same rights as employees when it comes to unfair dismissal. The proposal put forward by Labour is to regulate unfair dismissal to be a day-one right for employees and gig workers. Additionally, Labour aims to extend these rights further to cover other job benefits to gig workers, and in the past have suggested solutions such as portable benefit systems, where benefits would travel from job to job with the worker.
Conclusion
Becoming a gig worker can be very useful at the start of your career, or as mentioned, as a side gig, but it’s rarely taken up as a full-time “gig” due to the instability and lack of benefits. With so many people taking up gig roles it’s very promising that Labour is looking into making the industry more stable with regulations. Now they just need to follow through.
However, if you’re looking to get out of the gig economy, take a look at the roles available on the Recruiting Talent website.