Are you part of the ‘Gig Economy’? We explain what it is, where it’s headed, and how to make it work for you.

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26 March 2019

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An increasing number of people are opting for a role in the gig economy – defined, according to a submission2 to the Australian Parliament by AI Group, as “the growing number of workers abandoning traditional nine-to-five employment in favour of working independently on a task-by-task basis for various employers”.

With the introduction of popular apps like Uber and Deliveroo, this kind of gig-based work is becoming more and more popular and easier to access. But is joining the gig economy a viable long-term work option and, if so, how do you make it work for you?

For the first time since records of this type were kept, less than half of Australians are employed in permanent, full-time jobs1.

The gig economy has grown for many reasons; increasing connectivity making it easy to undertake many jobs in a different manner; platforms such as Upwork and Freelancer; the emergence of co-working spaces; and SMEs in particular being increasingly open to bringing in expertise for specific projects, rather than relying solely on internal resources.

Indeed, in a study into the gig economy by EY3, 56% of organisations reported the most significant reason for using contingent workers was to complete projects where the specific expertise was beyond the capability of the existing workforce, while 55% reported using contingent workers to help control labour costs (55%).

By its nature, the gig economy is global and, according to research, is only going to grow. Different research pins the exact number of gig economy workers at different levels – according to LinkedIn, by 2027 47% of the working population in the United States will be freelance4, while a study from freelancer site Upwork puts that figure closer to 55%5.

Either way, it’s growing. So, if you’re thinking of joining the gig economy, here are five tips to help make it work for you.

1. Sign up to a good invoicing program

A good time tracking and invoicing system will ensure you’re on top of the work, you know what you’re investing time in and, more importantly, your invoices are easy to create and send out. After all, the invoicing and debt collection is now your domain. You’ve got to keep the money rolling in!

2. Take part in networking events

Whether it’s attending in-person events or using LinkedIn more actively, networking is crucial to keep new business coming in. Practice your elevator pitch, get used to meeting new people, and very quickly networking will become an enjoyable, rather than cringe-inducing, part of your new job.

3. Explore co-working spaces

Co-working spaces are popping up all over the place, and are a great spot to meet like-minded people who are also working for themselves. They can be a hive of energy and enthusiasm, and the environment can be a great antidote to the potential motivation killer of another day at home.

4. Get the right protection

While working for yourself may be the dream, it’s only one illness or accident away from becoming a problem. Make sure you speak to an adviser about the right income protection policy for your situation, and ensure your life insurance, total permanent disability, and critical illness cover are in place.

5. Find a good accountant

From the structure of your business to putting the right amount away for tax and super each month, your accountant will be able to help you get your financial structure in place. It’s imperative you keep money aside each month to avoid a potentially venture-ending tax bill further down the line.

References

  1. https://www.futurework.org.au/the_dimensions_of_insecure_work 
  2. https://www.aph.gov.au/DocumentStore.ashx?id=a6f714ed-dd1b-4374-a748-0c7d4d1a29d1&subId=460121
  3. https://gigeconomy.ey.com/Documents/Gig%20Economy%20Report.pdf
  4. https://www.linkedin.com/profinder/blog/freelance-generation-redefines-modern-workplace
  5. https://www.upwork.com/press/2017/10/17/freelancing-in-america-2017/

 

These pages contain general information only and do not take into account your personal circumstances, objectives or needs. This information is provided in good faith and believed to be accurate at the time it was placed on the MLC Life Insurance website, however we make no representation or warranty as to the reliability, accuracy or completeness of this information.

The information provided is not intended to constitute financial, legal or medical advice, or to substitute for the need to consult with your advisers or treating practitioners. Before acting on any information in these pages, you should consider whether it is right for you and consult with your financial, legal and/or medical advisers.

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