The Gig Economy is Growing — But Is It All It’s Cracked Up to Be?

The Gig Economy is Growing — But Is It All It’s Cracked Up to Be?
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We’re firm believers at here at The Penny Hoarder that side gigs are a great way to earn solid money for bills or a few extra bucks for mad money.

It’s tough to know how many gig workers there are, but the Bureau of Labor Statistics is busy trying to collect those statistics right now.

Some researchers estimate it to be “about 34% of the workforce and [is] expected to be 43% by the year 2020.”

In other words, there are a whole lot of people out there working as independent contractors and freelancers.

In the job market, however, popular jobs aren’t always lucrative ones.

Analysts over at Priceonomics combed through a massive amount of anonymized data from loan applicants to find out just how much money people in the gig economy were raking in (or scraping together).

The results aren’t pretty.

Researchers found that 85% of gig workers make less than $500 per month.

Apparently Airbnb is where the money is. The room-sharing service ranked number one on Priceonomics’ list of top companies in the side gig market. Renters make an average of $924 per month.

Number nine on the list is social car-sharing service Getaround where people make an average of $98 per month.

That’s right — the average monthly income gap between the top and the ninth-ranked company is a staggering 90%.

If you love numbers, be sure to check out all the interesting ways Priceonomics sliced and diced the data it collected.

Where Have We Heard This Before?

The idea that the sharing economy so many of us rely on may not be all it’s cracked up to be sounds familiar.

Oh, right. NPR recently interviewed ridesharing service drivers and found the idea that gig workers can be their own boss doesn’t always square with reality.   

Seth F. Is one of several gig workers chronicled by the New Yorker earlier this year. “The gig economy is such a lonely economy,” he said, despite earning $55 per hour as an independent contractor with a popular service platform.

But Wait! Here’s the Other Side of the Story

Whether you’re an hourly worker, salaried employee or independent contractor, every type of employment has its pros and cons.

For many, the benefits of the sharing economy far outweigh the drawbacks of an industry that’s just beginning to get it’s legs.

Entrepreneurs and workers with specialized skills can make serious bank in the gig economy by “moving from good jobs to great work,” according to Harvard Business Review’s Diane Mulcahy.

“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,” she said.

With the sharing economy here to stay, some lawmakers are doing what they can to improve the worker experience. The U.S. House of Representatives and Senate are now considering a bill that would bring portable job benefits to American workers in the gig economy.

As the sharing economy gets its act together, one way to succeed is to treat your gigs with the same seriousness you would any other type of work.

Let’s be real. A career in the sharing economy may not be a glorious bucket of flowers every single minute but, really, what kind of career is? (Okay, maybe this one.)

Remember, if things don’t work out there are a record number of jobs open right now. The traditional workforce would love to have you back.

Lisa McGreevy is a staff writer at The Penny Hoarder. She’s been a part of the gig economy for almost 20 years and knows it’s not easy — but it is worth it.