It’s the latest trend in an evolving workforce where individuals seek employment on their own terms. It is known as the “gig economy” and it’s here to stay! But what is it exactly, what kind of jobs are involved and how can you be part of this booming industry?
According to the Macquarie dictionary, the gig economy is “individual workers … employed on a contract to do a particular task for a set time with little connection to their employer”. People work in the gig economy for a variety of reasons and in a variety of ways. Some people work in the gig economy as their main source of income. Others work in it occasionally to supplement their income when moving between careers, jobs or as a transition into retirement.
Participation in the gig economy has grown rapidly over the past few years, particularly with the challenges of COVID-19. The gig economy has transformed the traditional, in-office 9-5 working world and caused many to pursue “gig” work for additional (or even primary) income.
Employment figures are also a factor, with the Australian Bureau of Statistics reporting that in April 2020, underemployment hit a record high of 13.8 per cent, and in June of that year, unemployment hit a record high of 7.5 per cent — the highest level in over 20 years. For many, the gig economy was, and still is, a way of keeping money trickling in.
The gig economy can offer individuals flexibility and convenience. It gives individuals the opportunity to work when and how often they want, and to balance work with personal commitments such as hobbies, study and family responsibilities.
Examples of “giggers” include project-based workers, independent contractors, freelancers, sole traders and people hired temporarily or part-time.
But perhaps one of the biggest draw-cards of the gig economy is the breadth of variety in terms of the industries you can work in. You can specialise in anything from graphic design, E-commerce, copywriting and bookkeeping to childcare, beauty, gardening and even dog grooming! And that’s just the start! Many giggers also run their own ridesharing, delivery, tutoring, administration, marketing or project management businesses.
There is a wealth of advice readily available on how to join the gig economy, including at the national and state government levels. But here are five of our top tips.
If you want to be part of the gig economy in terms of starting your own business and being paid for your goods or services, you will need to register for an ABN (Australian Business Number) to legally operate.
This is a unique number that the Australian Business Register issues to all businesses. It identifies your business to the government and community and to the Australian Taxation Office (ATO) when dealing with your tax obligations. If you earn more than $75,000 per annum, you must also register for the Goods and Services Tax (GST), which requires an ABN.
If you want to join the gig economy, marketing and advertising your brand and business is critical. A good place to start is by researching problems, trends, demographics and other observations within your target market. Then, take a close look at your business and see how you can set up smaller marketing tasks. Here are some examples:
Another important element to consider if you are keen to join the gig economy is insurance, particularly if you are a sole trader. A sole trader is classified as “someone who owns and operates a business in their own name”. The different types of insurance include:
If you are considered to be a sole trader or self-employed by the Australian Tax Office (ATO), obviously, super payments won’t be contributed on your behalf by an employer. However, any super you pay will be your choice rather than a legal requirement.
The benefits of contributing to super include:
Between managing customers and clients, sending invoices, marketing your products or services and actually working, finding time to undertake your own administration and finances can be challenging. If you work for yourself as a contractor, freelancer or sole trader, engaging the services of a professional accountant can help with:
