What’s Your Gig?
August 16, 2021
I recently read a Forbes article called “Will the Gig Economy Become the New Working-Class Norm?” It got me thinking. It certainly feels like there’s a major shift in how people are choosing to live and work. Here’s what some of the data says:
A recent EY 2021 Work Reimagined Employee Survey found 54% of the more than 16,000 employees surveyed globally would consider leaving their position after the pandemic if they were not given flexibility in where and when they work. While some regulators, for example in California, are taking actions that will make gig work more difficult to find, the desire for greater control over our jobs is growing. Supporting this trend are apps such as FlexJobs and TopTal, which make it easier for freelancers to find gigs on demand.
The trend to more flexible working conditions coincides with the growth of labor shortages. In June, the Bureau of Labor Statistics reported 10.1 million new open positions, a record since they started tracking this metric in the late 2000s. Even with all these open positions, the number of individuals who have been unemployed for six months or longer remains high, with this group now representing over 40% of unemployed.
Of course, labor shortages are mainly due to factors other than changes in workforce sentiment. High unemployment benefits have had an impact. Moreover, the pandemic still looms large. For example, with vaccines only available to those age 12 or older, many parents continue to struggle to find safe, reliable childcare. Over 3 million women have left the workforce over the past year, leaving their labor force participation rate at its lowest level since 1988, according to the National Women’s Law Center.
A shrinking labor force and high unemployment benefits are putting upward pressure on wages. And, all of this comes at a time where consumer demand is soaring (retail sales in June significantly outpaced expectation, up 15.6% over last year). If production struggles to catch up, we could be looking at more shortages and higher prices in some industries. We’ve already seen this play out in the automobile and housing industry. On the positive side, if we adjust fast enough, industry will catch up, and that could be a major win for economic growth. Also, we have experienced enormous technological advancements since early last year, a possible counterforce against the drag of production dislocations. The pandemic has sped up the adoption of some key automation technologies. The use of robots and AI at big suppliers like Amazon has dramatically increased. Applications to streamline online ordering and delivery services mean many small businesses can easily outsource these tasks, boosting productivity and output.
The numbers seem grim, but I see this as a really exciting time where opportunities seem to be expanding and changing every day. The pandemic has forced us all to slow down, and maybe take the time to reflect on how we want to work and live. Ultimately that should be a very good thing.
Whitney Butler
