What’s In Store for the Gig Economy in 2020? Here’s Our Take

This photo shows two different gig economy jobs: dog walking, ride share driving, grocery delivery and takeout delivery.
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We live in a curious time of record-setting stock market highs, job openings and employment numbers, yet wages are largely stagnant. Meanwhile, basic costs of living are soaring. 

So what do we do? We take out our smartphones and download a side gig, duh.

As a staff writer at The Penny Hoarder, I keep up with the ever-changing nature of the gig economy. I track trends, vet new gig companies and apps and highlight unique side hustles. In my reporting, I’ve noticed that people seem to flock to gigs out of necessity and/or convenience.

As the gig economy roars into another decade, here’s what to what to watch for. 

Gig Economy: A Trendy Phrase for an Age Old Concept…

The first printed usage of the term “gig,” in the moneymaking sense, is often attributed to a British music magazine Melody Maker, which used the word in 1926 to refer to a paid musical performance. It’s easy to see how the term was co-opted to describe short-term and temporary work in a broader way. 

But the concept of “gigs” existed long before the century-old colloquialism.

“All over the world, and in parts of the world that don’t have a more formal economy, this is how everyone has been making a living for generations and centuries,” said author and podcaster Chris Guillebeau, who spoke to The Penny Hoarder ahead of his new book 100 Side Hustles. “All those people are entrepreneurs, whether they call themselves that or not.”

…But We’re Still Working Out the Definition

Here’s a fun exercise: Ask several friends to define “side gig” or “side hustle.” It’s likely all of them will come back to you with a different answer.

The problem plagues economic researchers, too. It’s hard to quantify a sector of the economy we don’t know how to define. Should it include second jobs? Is it any income outside of main employment? Wait a minute, you have no main employment, and your income stems from six different projects?

More inclusive definitions equate gig work with freelancing. According to a comprehensive annual study commissioned by the Freelancers Union and Upwork, more than 50 million Americans were a part of the freelance economy in 2019. The Federal Reserve released an economy well-being report in the summer that pegged the number closer to 80 million.

The real number is likely in between the two extremes. But one thing’s for sure: The gig economy is big — and it’s growing.

Yes, It’s Real Work, and You Should Put It on Your Resume

The resume as a chronological list of relevant job experience is becoming a thing of the past.

But you may not feel confident explaining your gig experience when applying to jobs in the traditional job market. You may wonder whether your experience dashing from restaurant to customer to restaurant counts as job experience at all.

It certainly feels like work. But do hiring managers view it the same way? I asked career experts from Goodwill, the Society of Human Resource Management and the University of South Florida to weigh in. They were loud and clear: include gig experience on your resume.

To better highlight your gig experience, drop the bolded job titles and employment dates. Instead, focus on your accomplishments. Tell exactly how you maintained that five-star driver status.

Describe your “transferable skills” on your resume and during job interviews. These are skills you picked up from your gig that are relevant to the position you’re seeking.

Gigs Are Going Digital, and It’s a ‘Wild West of Working’

Gig apps are often advertised as ways to break the 9-to-5 chains, allowing us to work whenever and wherever we want. The reality isn’t nearly so liberating.

I recently spoke to Dr. Alexandrea Ravenelle, a gig economy researcher, author and professor of sociology at the University of North Carolina, about hustle culture and the dark side of the gig economy

“When we have gig workers going from one job to another job and constantly running around and hustling,” she said, “that’s a prime situation for burnout.”

According to federal reports, Americans are increasingly using money from gigs to cover basic necessities. That, too, is a recipe for disaster.

As much as possible, Ravenelle says not to use money from gig work to cover bills like rent or food. If that’s where you’re at, a part-time job is likely a better option. At the very least, the pay is predictable and you’ll have basic rights if you get harassed or injured on the job.

“There are no protections for these workers because they’re [independent contractors], and they’re outside the protection of workers comp. They’re not protected by OSHA,” she said. “It’s very much a sort of Wild West of working.”

California’s New Law Could Define the Future of Gig Work

California is a microcosm of the pros and cons of gig work. It’s the most populous state with some of the highest living expenses. It’s also home to the most popular gig companies: Uber, Lyft, Doordash, Instacart, Caviar and several others are based out of San Francisco.

In 2019, debate engulfed the state regarding AB 5, a law that essentially reclassifies gig workers as employees of the hiring company if the worker meets certain criteria.

Under the law’s definition, a large portion of California gig workers are expected to become employees, meaning employers will soon have to pay Social Security taxes and provide workers comp and other basic workplace protections.

“It could be disastrous for their business plan,” Ravenelle said.

And the gig companies know this. Uber and Lyft together pledged to spend $90 million on advertising to oppose the bill.

This is how everyone has been making a living for generations and centuries.

I was in San Francisco on the evening California legislators passed AB 5. Several gig companies sent out emails that night and the following day, urging their drivers and couriers to call the governor and tell him not to sign the bill into law. 

California Gov. Gavin Newsom signed AB 5 anyway. It’s slated to go into effect in January.

The major gig companies are already fighting it. Tony West, Uber’s Chief Legal Officer, said in a public phone call that he believes AB 5 doesn’t apply to Uber.

“Contrary to some of the rhetoric we’ve heard, AB 5 does not automatically reclassify any rideshare drivers from independent contractors to employees,” West said. “AB 5 does not provide drivers with benefits, nor does it give drivers the right to organize. In fact, the bill currently says nothing about rideshare drivers.”

Depending on how the law rolls out in 2020, other states could use AB 5 as a roadmap for similar regulations on gig work.

We’ll be keeping a close eye on it either way.

Adam Hardy is a staff writer at The Penny Hoarder. He specializes in ways to make money that don’t involve stuffy corporate offices. Read his ​latest articles here, or say hi on Twitter @hardyjournalism.