The Gig Economy ExplainedWilliam Hadley
We have heard a lot recently about the ‘gig economy’. The chartered institute of professional development estimate that 1.3 million people work in this sector.
What is Gig economy?
Previously they may have been referred to as being freelancers, contractors or simply self-employed. However their work today is most likely assigned by an app-based system which has spawned a whole new subsection of the economy.
Workers employed in the Gig economy are paid for each job or “gig” they do rather than receiving a regular wage or salary. Those in favour of this way of working say that individuals have choice and flexibility, they can juggle their work around other priorities in their lives such as studying or childcare. They go on to say that it benefits employers as they only pay for the job that is done or for the time when there is a demand. When demand drops off they are not burdened with staff costs on top of other overheads.
This is by no way a new method of working. Prior to the industrial revolution most people were self-employed, hours were flexible and depended on the work that needed to be done. A person would be employed to do a particular job and when it was over so was their employment. Back in the mid 1800s the workers had no union representation and very few rights. If it sounds familiar I’m not surprised, it’s the same arrangement as exists in the Gig economy today.
Zero hours contract workers and Gig economy workers differ in one important way. Although not guaranteed particular shifts, zero hours workers are treated as employees, they have workplace pensions, the employer makes national insurance contributions and they receive holiday and sick pay. Zero hours workers tend to be on the minimum wage, but they enjoy many rights not extended to those in the Gig economy.
Bookkeeping for Gig workers
How do you keep your books if you’re an occasional worker in this sector? The answer is simple. Although the term is new and the work relies on apps and technology the “gig worker” is, for at the time they are working at least, self-employed. HMRC have a host of useful information to keep you on the right track which can be accessed at www.gov.uk/working-for-yourself.
Cashflow Manager bookkeeping software is designed for the self-employed and small businesses, it’s row and column layout makes it intuitive to use and simple to extract important information. Gig economy workers need to be free to work as and when they want and with Cashflow Manager you won’t miss out on business because you’re doing your books.