In 2020, there were 228,200 independent workers in Singapore according to the Ministry of Manpower (MOM). This number makes up nearly 10% of the total workforce in the country, and the trajectory is expected to grow further in the years to come as more and more people embrace freelance work as their primary source of income. The rising number of freelance workers in Singapore is consistent with a growing global trend that is increasing the size of the gig economy worldwide.
So what is the gig economy, and why is it appealing to so many workers despite the many uncertainties associated with freelance work? The word ‘gig’ is a slang term commonly used by musicians playing venues and refers to a one-off job. The term has since been adopted by independent workers who participate in the labour market through temporary, short-term, and flexible contracts with employers. Hence the gig economy can be defined as a labour market where short-term or part-time employment is prevalent. And the gig economy is thriving, due to factors such as technological advancements and a shift in work culture globally.
Gig Economy vs Sharing Economy
While the advancement of digital technology has become the primary driver of the gig economy, it has also enabled what is known as the sharing economy. The sharing economy allows for individuals or groups of people to make use of owned assets and rent them out to people for an income, usually through a peer-to-peer platform (p2p). There are some overlaps between the two, such as the utilization of technology and the characteristics of flexible employment, but they differ widely in many areas and are not to be confused with each other.
Is the gig economy for you? Pros and cons of the gig economy
Traditionally, freelance work has often been associated with uncertainty and an unstable income. Freelance workers in the past have often been stereotyped as being unqualified or unskilled workers, or even as individuals who are unable to hold or get a permanent job. The truth could not be further, and such collective mindsets are slowly ebbing away as proven by the rising statistics of people who are opting to engage in freelance work. The Covid-19 pandemic has also contributed to helping shed this traditional way of thinking when it forced large numbers of workers to work from home, inadvertently making many workers realize that remote work is entirely possible, enabled by technology. In Singapore, the vast majority of own-account workers said that they engaged in the gig economy by choice, mostly because they enjoyed the flexibility and freedom associated with freelance work. Others engage in the gig economy as a supplementary source of income. And why wouldn’t you, if you have certain sets of skills or assets to offer as a service?
Aside from the desire to have more freedom and flexibility, the gig economy also offers traditionally non-employed individuals the opportunity to earn an income. Take for example a housewife or a stay-home dad, a retiree, or university students looking to supplement their income, just to name a few. Or perhaps you have a skill that isn’t being utilized much at your permanent job, such as playing a musical instrument, teaching, or baking. These are skills that can be utilized to serve a demand for music instructors or baked goods, for example.
So is the gig economy for you and are you prepared for it? It really depends on how you see yourself earning an income and your appetite for risk-taking. If you’re thinking of breaking into the world of freelancing, whether as a side hustle, a part-time job, or starting a freelance business, consider weighing the following pros and cons of being an independent freelance worker.
Pros
Freedom and flexible hours – As a freelance worker, you are in control of your own time and you will have the final say as to what jobs you decide to take on and which ones you decline. You are your own boss.
Flexible location – As long as you have the right equipment, usually a laptop and a reliable internet connection, you get to work from anywhere you want. There is also a rising trend of ‘digital nomads’, freelancers who work remotely in different countries.
Earnings – Since you are your own boss and take full control of the number and type of jobs you do, you could be earning way more than you ever would with a permanent job salary. The catch is that it does not offer the safety net nor consistency that a permanent job does.
Utilisation of skills and assets – You could be possessing skill sets that may have been under-utilized at your permanent job, or that it never occurred to you that you could be paid for it. The gig economy allows you to get paid for those skills or assets. It could also be an opportunity to improve your existing skills or learn a new one. We’ll discuss more about this later on.
Cons
Unstable income – It’s easy to choose and pick jobs to suit your needs in good times, but in the event of an economic downturn and the opportunities dry up, your income will start to shrink or may not even exist. There’s no guarantee of a consistent income as a freelancer. If you are the type of person who isn’t good at handling anxiety and uncertainty or have heavy responsibilities as the sole breadwinner of your family, you might want to think twice.
Retirement planning – While permanent workers are guaranteed a retirement fund contribution from their employers, such as the Central Provident Fund (CPF) in Singapore, freelancers have to do this on their own volition. Since there are no mandatory employment laws regulating you as a freelance worker to contribute to your CPF, it’s up to you to be disciplined enough to set aside a regular contribution to your retirement funds.
No healthcare benefits – Freelance workers will not be able to enjoy the usual perks that regular full-time employees get, such as healthcare benefits for example. In Singapore, permanent employees will have a portion of their CPF contributions directed into the MediSave account, which is a national medical savings scheme that helps individuals set aside part of their income to pay for their personal or dependents’ healthcare needs. In addition, employers of permanent workers usually provide an annual allowance for health checkups, optician visits, medical insurance, and dental allowance. As a freelance worker, finding a good substitute for these healthcare benefits should be considered important to protect yourself.
No perks – With no employer to reward them with the perks of working full-time, freelancers will miss out on these additional benefits. Permanent employment perks such as the number of leave days are not applicable to a freelance worker, and many freelancers are willing to forego perks like gym allowances and staff discounts. Employment perks vary across different companies and industries.
Accountability – With no one to keep you in check, being a freelancer means that you have to be accountable to yourself. It sounds easy, but there’s a lot of discipline involved with being your own boss. Any missteps in time management or indulging in procrastination would mean that your income could be badly affected.
Increasing competition – As the freelancing trend continues to grow globally, and the size of the gig economy increases, no doubt this would mean a more competitive labour market. A higher number of people offering the same type of service or doing the same type of skill could also mean a lower market pay rate for those freelance workers since there is ample demand. Furthermore, with internet penetration at an all-time high across most countries in the world, borders and geographical constraints no longer apply to job seekers who can do work from anywhere in the world regardless of time zones. A freelancer in Singapore will not only have to compete with a Singaporean freelancer but also those who are in neighbouring countries such as Vietnam and Indonesia.
Common freelancing positions and where to look for them
Not sure how to start being a freelancer? Depending on your available skill set, some types of jobs may or may not be suitable for you. Regardless, every individual has something to offer, you just have to identify what you are good at and what you are not.
Here is a list of common freelancing jobs in the gig economy, the associated skill set for each position, and where to look for them.
Freelance Writer
Associated skills – copywriting, SEO writing, good command of language, content creation, data analysis, research
Part-time Teacher / Tuition Teacher
Associated skills – being good with a specific subject, tutoring, communicative
Ride-Sharing Driver / Courier / Delivery
Associated skills – Ability to drive or ride, efficient, fit to drive or ride, communicative
Music Instructor
Associated skills – Ability to play a music instrument, communicative, knowledge in music theory
Part-time Model
Associated skills – Aesthetics, communicative
As for where to look for these jobs, there are various platforms for different types of jobs. Platforms that encompass all types of freelance jobs in the market and help to connect employers and freelance workers include Bridge.com.sg, LinkedIn, Fiverr and UpWork. For positions such in ride-sharing or deliveries, there are plenty of companies that have been modelled by the advances in digital technology such as Uber, Grab, GoJek, and FoodPanda.
Final Thoughts
There is no doubt that the gig economy is shaping the future of work and is changing the way employees approach work. The rising statistics prove that the trend is here to stay and will continue to grow as the years go by. Governments have also started to pay more attention to workers in the gig economy, and the structure and model of the gig economy could potentially become better and more welcoming to future freelance workers. Whether or not doing freelance work as your primary source of income is for you, really depends on you and the things you value in your life.
If you’re considering being a freelancer or are looking for potential jobs, Bridge could be your solution.
