Four Main Traits Each Gig Employee Ought to Count on within the 2021 Economic system

As a employees author, I cowl tendencies in facet gigs, app-based work and odd jobs, collectively known as “the gig financial system.” These tendencies are risky throughout an excellent yr, and 2020 was something however an excellent yr.

Final yr, I wrote the same article about what to look at within the gig financial system in 2020. And I’ll be the primary to let you know I acquired some stuff laughably incorrect. Nobody may have predicted a pandemic that steamrolled our financial system.

However as issues inch again to some sense of normalcy, there are a couple of tendencies that we are able to fairly anticipate in 2021. Right here’s what I’ll be watching.

1. An Total Growth in Gig Work

The gig financial system ballooned like no means earlier than in 2020.

In accordance with an annual survey commissioned Upwork, the freelance financial system (together with gig work like ridesharing in addition to skilled freelance providers) soared to $1.2 trillion this yr — a 22% enhance from 2019.

On its face, that may sound like an awesome factor, however it’s extra difficult. As a substitute of breaking our 9-to-5 chains, gig work has as an alternative grow to be a significant security web. Gigs have been there for tens of millions of Individuals when conventional jobs weren’t.

So when the gig financial system sees large good points prefer it did this yr, that could possibly be an indicator that the standard financial system is tanking and forcing individuals to choose up second or third jobs to get .

These good points weren’t distributed evenly, both. Much like the standard financial system, occasions and entertainment-related sectors shrunk significantly, whereas supply and e-commerce shined. With a vaccine rolling out and native economies creaking again open, it’s doubtless these discrepancies will begin to even out within the coming yr.

The general job market, nonetheless, will take for much longer to get well. Some economists predict issues received’t be enterprise as standard till 2024.

In the mean time, gig work will stay a makeshift security web and proceed rising in 2021 and past.

2. Facet Gigs — With out the ‘Facet’ Half

In an ideal financial system, you wouldn’t want a facet gig as a result of your day job can be steady and would pay you nicely sufficient to cowl a snug lifestyle.

In an imperfect however functioning financial system (assume U.S. circa 2019), you may want a facet gig that can assist you meet a purpose. You could have a stable day job however possibly you wish to begin Ubering briefly that can assist you repay your pupil loans or bank cards. Higher but, you launch a facet gig to hone new expertise that may translate into a greater job — and even your personal enterprise. (That is actually the perfect side-gig situation. We extremely suggest creating the same “exit plan” in your facet gig earlier than taking over extra work.)

Then there’s the pandemic financial system. Cue the unhappy trombone. It has grow to be more and more frequent for individuals to cobble collectively their total earnings off a smattering of various gigs. There’s no principal gig or job. So none of them are technically “facet” gigs.

In an interview with The Penny Hoarder earlier within the pandemic, Shiftsmart President Patrick Brandt, stated he sees this gig financial system development taking part in out on his app, which supplies a free service that pairs customers with native or distant gig work and pays them per shift.

“Individuals who have been simply utilizing us for [side money] at the moment are utilizing us to stack shifts throughout a number of alternatives to meet their total earnings,” he stated.

Till the standard job market recovers, extra individuals shall be pressured into the same state of affairs.

3. A Coming Cliff for Some Gig Staff

For the primary time ever in 2020, individuals with out sufficient work historical past — together with impartial contractors and gig staff — may qualify for unemployment advantages via a brand new program known as Pandemic Unemployment Help.

This system was created via the $2.2 trillion CARES Act again in March 2020. It has been a lifeline for tens of millions of Individuals who’re out of labor because of the pandemic however don’t meet the necessities for normal unemployment insurance coverage. The December stimulus package deal prolonged PUA into March 2021. Plus, it rebooted the improved weekly fee program referred to as Federal Pandemic Unemployment Compensation (FPUC) — although this time as a $300 weekly enhance as an alternative of the unique $600.

All excellent news up to now. However the December stimulus package deal additionally included some stipulations that may have an effect on your advantages when you’re a gig employee.

By the top of March 2021, PUA recipients should submit paperwork (earnings statements, ledgers, 1099s and extra) to show their eligibility for this system. Offering such documentation could show tough for even probably the most earnest bookkeeping gig staff, as a complete file of 1099 earnings is notoriously powerful to take care of.

Fail to produce the right data, and PUA recipients could also be requested to pay again the unemployment cash.

Beforehand, PUA recipients may self-certify that they have been out of labor on account of coronavirus-related causes — primarily pinky-promising beneath penalty of perjury.

Moreover, the December stimulus package deal was a lot smaller in scope than the CARES Act. It supplies solely 11 extra weeks of unemployment advantages. The financial state of affairs is unlikely to resolve itself inside that timeframe, so jobless of us could as soon as once more face their advantages being lower off in March 2021 except there’s a third stimulus package deal.

4. Ripple Results of a New Gig Economic system Rule in California

One thing occurred this yr that has the potential to vary the character of the gig financial system. I’m not speaking concerning the pandemic.

After an extended and costly marketing campaign that pitted some gig staff, unions and worker-rights advocates towards Uber, Lyft, DoorDash and different main gig firms, a poll measure known as Proposition 22 handed on Election Day in California. Gig firms spent a collective $200 million in assist of this new rule that impacts their gig staff and impartial contractors.

Why would they spend a lot cash lobing in assist of this rule? Properly, if Prop 22 hadn’t handed, Uber, Lyft and different firms that depend on impartial contractors would have needed to reclassify their staff as workers. Amongst many modifications, they’d’ve been pressured to stick to minimal wage legal guidelines, grant advantages like medical insurance, pay payroll taxes and supply staff compensation.

Prop 22 is actually a compromise. It doesn’t provide gig staff with the complete advantages of W-2 employment, however it supplies greater than they’d beforehand. Uber CEO Dara Khosrowshahi refers to it as a “third approach.” It doesn’t grant a minimal wage, however it does give gig staff an “earnings assure” and subsidizes medical insurance prices in the event that they commonly work a sure variety of hours.

Why this issues is as a result of the gig employee classification concern isn’t contained to California. It’s sprouted up in Illinois and New York already. And Khosrowshahi has overtly said that he sees this “third approach” as a nationwide answer to the controversy, which is bound to engulf much more states within the yr to come back.

Adam Hardy is a employees author at The Penny Hoarder. He covers the gig financial system, distant work and different distinctive methods to earn a living. Learn his ​newest articles right here, or say hello on Twitter @hardyjournalism.

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