Something drastic is changing the workplace fast. Most of us are not prepared for it and neither are the government fat cat bureaucrats in Ottawa and Edmonton. The fat cats will take lots of time to adjust as usual, but we as individuals can act fast to prepare and expect this economic shift. Every day that goes by where new technology is implemented and new millennials enter the workforce, there is a further push towards the gig economy. So what exactly is the gig economy, why are we transitioning into it, and what are 3 things to expect in the coming years as a result of it. One thing we expect at QuadRipple is the continued growth in coworking spaces to accommodate for millennials doing gigs.
To summarize, the gig economy is a work environment that favours temporary and contract positions with independent workers for short-term engagements. Basically, freelancing for “gigs” depending on your skills. This trend has already begun and the greedy government is shaking in their jackboots from the thought of lost tax revenue and I love it. It also has us confused about what it means to be employed and is blurring the lines between part-time and full-time employment definitions. The rapid growth in the existence of coworking spaces and incubation space in recent years to accommodate these freelancers are evident by the statistics and trends. By 2020, Intuit predicts that 40% of Americans (and likely a similar portion of Canadians) will be independent contractors.
There a few reasons why the economy is transitioning to gigs and moving away from part-time and full-time careers. Perhaps the biggest “puller” to joining the gig economy is digitization and the biggest “pusher” to move away from the traditional office environment/9-5 has been millennials attitudes towards work.
Digitization has made it possible and lucrative for many people to work as subcontractors today. Computers, smartphones and the internet have replaced so many productivity and communication tools that used to exclusively exist at a centralized office location. You used to have to be there whether it be to use expensive tools like fax machines for sending documents, Xerox machines to print reports or a call centre to make sales calls to China. Now the equivalent of all that can be done from your smartphone; much faster and for free too which makes gigging very lucrative. Also, new technology is allowing people to participate in this industry much easier through web and mobile applications such as Uber and Airbnb, where anybody can be a taxi driver or hotel manager on the side. Like to cook and meet new people? Ourhomecook is a local example here in Alberta where chefs can make money for hosting home cooked meals.
Millennials really emphasize this thing called work-life balance. As we all know, most millennials increasingly spend less time at a particular workplace and shift it up frequently. Loyalty to employers is far less than it’s ever been and continues to decline. Let’s face it, millennials have commitment issues! Now that working on gigs is possible for anyone due to technology, the traditional and boring, top-down, 9-5 desk job (10-3 if you are government) is just not worth it anymore for us smart millennials. Working on gigs does not prohibit you from shopping around and working on contract for other employers. Working freelance, remotely, and by the hour enables you to net a higher wage by the hour and leaves you with more free time. The tradeoff of course is the lack of a stable and consistent paycheque every 2 weeks.
So what are 3 implications we anticipate to see in a few years?
Discussions about UBI (Universal Basic Income)
As mentioned, the lines are being blurred between what it means to be employed full-time, part-time and just gigging it out. The minimum wage policy is an outdated one when less and less people are working for a wage and an increasing amount of people are being paid as contractors. Expect pressure to be put on governments to repeal minimum wage legislation and look into more appropriate measures to uphold a standard of living with a universal basic income, basically an allowance. I will elaborate on more in future articles.
Coworking space explosion
Coworking spaces and incubation spaces have seen an explosion in the past 4 years. Expect this trend to continue upward. With people flooding out of centralized offices and decentralizing operations to their homes or coffee shops, they quickly will realize that there is much less social interaction at home and the coffee shop is not the ideal workspace. Shared office and coworking spaces can fill this void. Digitization is leading to a greater connectedness but it is also encouraging a decline in daily face-to-face human interaction. Expect coworking spaces to become this networking mecca where you can interact with people in person, grow your business, and get more gigs!
Dwindling tax base/Smart accounting
The gig economy is a spinoff of the sharing economy. With the decline in traditional payroll methods it will be a challenge for the government to immediately tax your income before you receive it. It also makes filing taxes a bit more of a responsibility for those of us working in the gig economy. Expect the government to not be happy about losing this tax base and stay ahead of the curve by familiarizing yourself with the newest tax regulations and get yourself a really good accountant to maximize your earnings!
To support the growing and impending gig economy, QuadRipple is excited to move forward into the next expansion phase and vision for our company by opening HustleCo Workspace. The HustleCo Workspace will be a shared coworking space opening Summer 2017 in Calgary with a superior motivational and engaging work environment optimized for entrepreneurs and freelancers. The HustleCo workspace is about much more than just dividing office space and providing desks. It’s about creating a space with a culture so contagious that people are addicted to going to work because the environment fosters creativity, community, hard-work and hustle. The winning and athletic work environment coupled with access to beneficial resources and superior marketing guidance from QuadRipple at the HustleCo Workspace enables members and visitors to reach their full potential unlike any other coworking space on the market.