The Gig Economy in 2023

As the gig economy continues to grow, we may be about to see a paradigm shift in employment.

Image credit: Shutterstock / Prostock-studio

The share of gig workers in the labor market has risen sharply over the past decade with the success of online work platforms.

A gig worker—in case you are not familiar with the term—is anyone who is not on a conventional full-time job contract, and instead engages in freelance or on-demand work.

Digitalization and the rise of platforms such as Upwork, Fiverr, and DoorDash has paved the way for more gig work opportunities, thus reshaping the service industry and expanding its reach.

The driver who delivers your food order to your doorstep, the artist who provides you with on-demand graphic design services, and even the independent consultant who you may call upon for a serious business decision have one thing in common: they are all gig workers.

The gig economy is no longer a small niche that can be overlooked.

By some calculations, gig workers now make up a quarter of the workforce in some parts of the world. It is thanks to the gig economy and countless such workers that the 2010s saw major innovations in the startup ecosystem. Where would the likes of Uber and Upwork be without drivers and freelancers eager to join?

“The ‘gig economy’ accounts for up to 12 percent of the global labor market—much higher than previously estimated—and holds particular promise for women and youth in developing countries,” observed a press release by the World Bank in September, 2023.

In the US, “widespread tech industry layoffs are accelerating a shift to gig work as more companies bring on contractors instead of full-time workers,” noted USA Today’s Paul Davidson in 2023.

Gig work may be about to change the paradigm of work as we know it. And as we continue to go through this transformation in 2023, new trends are appearing across the gig economy.

Aside from the obvious observation that gig economy now accounts for a larger portion of the labor market, it is becoming more acceptable as a form of employment.

Many professionals see gig work as a way to make money without compromising their freedom.

So-called digital nomads, for instance, have welcomed this way of life; young knowledge workers who have the opportunity to work remotely on an on-demand basis increasingly tend to flock to exotic destinations to enhance their life experiences while they make a living.

This has prompted countries from Barbados to Estonia to introduce a new category of mid-term visas commonly known as the digital nomad visa. Over 20 countries have introduced digital nomad visas over the last ten years.

Even Germany, whose work culture is often described as conservative and traditional, is now offering a freelancer visa.

There is little doubt, as such, that a freelance revolution is underway. But will the new order be fair to both the employers and the gig workers?

One criticism directed at gig economy is that large businesses may use on-demand work to sidestep employees’ rights.

“Social protections for workers in this segment are still lacking,” agrees the World Bank’s press release.

Many gig workers appreciate their freedom of moving from one gig to another without many strings attached!

At the same time, however, gig workers are deprived of the usual perks and benefits given to full-time employees such as bonuses, paid leave, and insurance.

This might not have been a problem in the early 2010s, when the gig economy was in its infancy and chosen as a temporary way of life by—often young—digital nomads. However, as the global economy starts to endorse gig work as an acceptable form of employment, these shortcomings must be addressed.

It may be too early to claim that gig workers form the backbone of our economy, but if what we have seen since the 2020 pandemic is any indication, this may soon be the case.

Some countries such as Australia are already putting measures in place to improve conditions for gig workers. The country’s “Closing Loopholes Bill” introduces minimum standards for gig workers, which will translate into a collective AUD400 million wage boost. Other countries may have to follow suit soon to regulate this form of employment.