Gig Economy

The Gig Economy Gets Ready To Scale

The Gig Economy Gets Ready To Scale

In the historical novel “Ivanhoe” (1819), Sir Walter Scott wrote of “free lances” to describe an army of professional soldiers for hire. The word “gig” as we know it entered the lexicon in the 20th century, thanks to musicians who moved from one performance (gig) to another, often filling in for others.

The gig economy is set to expand and take on new importance as the nation and world recover from COVID-19. While there is no roadmap at present, fortunately, there are pathways.

As is the case today, albeit on a far smaller scale, the market crash of 2008 left millions unemployed and scrambling. A crippled economy reorganized itself around freelancers and independent contractors – a nomadic workforce that has crystallized over the ensuing 12 years.

Pre-COVID, roughly 48 million Americans had worked gig economy jobs, and fully 40 percent of U.S. millennials identified as gig workers. As potentially hundreds of millions of individuals across industries and verticals embrace a new gig work reality, companies will need to upgrade, enhance and retool to support new and different ways of working.

New laws like California’s Assembly Bill 5 (AB5) and many others have also created new compliance hurdles for companies employing gig workers that must be managed. And PYMNTS’ latest Gig Economy Tracker notes that as the gig workforce expands and gains influence, payments choice will become increasingly important to retaining gig workers.

“Digital connectivity tools empower employees to work with companies around the globe on their own schedules – a development that partly explains why 68 percent of all gig workers joined this economy in the past five years,” the report states. “The expanding sector must work to satisfy these workers’ payment needs, however, as companies may lack specific payment processes devoted to freelancers. The resulting slower payments and invoicing can give ad-hoc workers less reliable payment schedules than full-time employees, exacerbating financial struggles. Late earnings disbursements can cause delayed bill payments – a rising concern when more than half of the U.S. workforce is expected to freelance by 2028.”

COVID-19 is already having more far-reaching impacts on gig workers than anything that’s gone before. As businesses and workers wait for the fog of war to lift – starting with the end of nationwide stay-at-home orders – getting the next normal underway is on everyone’s mind.

Reaching that next normal runs the gamut from finding work in the current climate, to new forms of ridesharing that cross into logistics, to enabling seamless cross-border payments for the increasing amount of gig work that’s paid in one currency and redeemed in another.

Join PYMNTS CEO Karen Webster and a fascinating panel of experts from Payoneer, Roadie and Wonolo as they break down “How We Work in a Gig Economy” post-COVID on Tuesday, April 21st at 12:00 pm ET on PYMNTS.

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LIVE PYMNTS ROUNDTABLE: MODERNIZING & SCALING FOR THE NEW NORMAL

The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.

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