A gig economy is a labor market that relies heavily on temporary and part-time positions filled by independent contractors and freelancers rather than full-time permanent employees.
Gig workers gain flexibility and independence but little or no job security. Many employers save money by avoiding paying benefits such as health coverage and paid vacation time. Others pay for some benefits to gig workers but outsource the benefits programs and other management tasks to external agencies.
The term is borrowed from the music world, where performers book “gigs” that are single or short-term engagements at various venues.
Biden labor proposal shakes up gig economy that relies on contractors
A U.S. Department of Labor rule proposed Tuesday would make it more difficult for companies to treat workers as independent contractors, a change that is expected to shake up ride-hailing, delivery and other industries that rely on gig workers.
The proposal would require that workers be considered employees, entitled to more benefits and legal protections than contractors, when they are “economically dependent” on a company. It could have wide-ranging impacts on company profits and hiring, household incomes and worker quality of life.
When interviewed by KTRH: Anthony Shields of Houston Small Business Marketing says how this will effect small businesses. “It would definitely hurt them. Usually most of the small business I work with have contractors because of all the associated fees that they know will be associated with employees.”
Shields saying in this time of soaring inflation, his clients would probably have to raise the prices they charge their customers. “Absolutely! They would have no option. They have to maintain their company and have to do something to make a profit so they could live!”