Recent research carried out by the Chartered Institute of Personnel and Development (CIPD) reveals that 1.3 million people are now taking part in the 'gig' economy using the internet and apps in order to find work.
Security, Pay and Rights
According to the research, the temporary or ad hoc nature of much gig economy activity means that many participants have little income security. Ambiguity over participants' employment status is also creating confusion over their eligibility to be paid the National Minimum Wage. However, most gig economy workers are employed in other more regular work or have another source of income, and therefore see their gig economy work as supplementary to this. Overall, only a quarter of gig economy workers say that the gig economy work they do is their main job, while nearly 58% are permanent employees. More than half of gig economy workers say that their gig economy work over the previous 12 months brought in 20% or less of their total income, with less than 10% saying that gig economy work brought in 75% or more of their annual income.
For many people, working in the gig economy is a positive choice rather than a last-resort option to lacking traditional employment. One of the most common reasons for working in the gig economy is that it allows participants to boost their income, with a quarter reporting that their work enables them to achieve an end goal, such as buying a car or going on holiday. Just 14% of gig economy workers say that they are only working in the gig economy because they have been unable to find traditional employment.
Progression and Training
The research also finds that 60% of gig economy workers consider that formal training or learning will be necessary during the course of their working lives, however 80% of these workers believe that they will face obstacles preventing them from doing so. This is, in part, due to not being able to afford to invest in their own skills development and also that employers or digital platform providers are unlikely to provide opportunities for them to go on training courses or learn new skills.
These findings also reflect a fall in investment in training by employers and cuts to the UK adult skills budget in recent years, which mean that opportunities for people in work or between jobs to upskill or reskill have been falling and look set to continue to decline unless the Government invests more in lifelong learning. There needs to be greater opportunities for gig economy participants and workers in more traditional jobs to take part in lifelong learning, to ensure that they are able to adapt to further technological advancement and that they have the skills to compete in an evolving labour market, where the nature of jobs is changing.
For further information, access the full report.
This report provides a refreshing take on the 'gig' economy and demonstrates that whilst there may be some unscrupulous employers around, a lot of employees genuinely want to engage on a casual basis as this is what best suits their needs.
That said, lack of clarity over employment status and associated rights of gig economy workers, remains an area of dissatisfaction amongst participants.
Employers should carry out a review of their workforce and ensure that they are not exploiting individuals or incorrectly classifying them as workers or self-employed when in fact they are employees and should be receiving the associated benefits.
There have been a number of recent cases in which the courts have had to rule on issues of employment status within the gig economy and it will be interesting to see whether this area will be significantly affected by the forthcoming Taylor review of the employment practices in the modern economy. We will keep you updated on the developments announced in the Taylor review later in the year.