From Gig to Growth – Why the Gig Economy Continues to Thrive

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The bubble has burst. The gig economy’s reign is over. The piecemeal, short-term approach is dead; long live the nine-to-five, steady career path. Right?

Wrong. Reports of the slowdown of the gig economy are premature at best. While it’s tempting to assume that the booming growth of the labour market’s newest sector would quickly run out of steam, the latest indications are that it remains in good health, with no obvious loss in momentum.

More than half a decade after the first major, tech-led gig marketplaces hit the UK, Indeed decided to take a look at the current state of play in the gig economy jobs market – and our findings may surprise.

How the game changed

Ride-hailing service Uber arrived in the UK in July 2012, with food delivery company Deliveroo launching the following year. The boom they ignited, both in the number of users and the resulting surge in job opportunities, turbocharged Britain’s nascent gig economy.

Others have followed – most notably Just Eat and Uber Eats – fanning a boom which attracted millions of customers, thousands of jobseekers and lots of headlines.

Since these are all now established companies (at least in start-up terms), you might expect, if not a decline, then a leveling off of interest in these roles as the growth and expansion begins to stabilise. However Indeed’s data, which gives a front row seat on the aspirations and appetites of jobseekers, tells a different story.

Glasgow had the highest change in interest in gig economy jobs.

Using jobseeker interest in gig economy roles as our gauge, the sector appears to be continuing to grow apace. Nationally, the proportion of searches for jobs with gig companies is up by a fifth.

Glasgow has the highest increase in the UK, fueled primarily by a staggering 722% jump in the proportion of searches for jobs with Just Eat. The takeaway company last year became the naming sponsor of Edinburgh’s cycle hire scheme, earning widespread national publicity that likely boosted Scottish jobseeker interest.

Meanwhile, London’s gig sector continues to thrive, despite being its most mature. The UK’s capital city was the launchpad for the likes of Uber and Deliveroo, and it might have been expected that other cities would now be seeing greater growth in jobseeker interest as gig companies expand across the country.

Instead, interest for gig economy jobs in London grew by more than a third over the last year. This is, however, down from a recent high of 341 searches per million in August 2016, which had dropped to 191 by the end of 2017 – the 257 figure from November 2018 shows a resurgence, though, and that any decline in the gig economy has been arrested and reversed.

The big beasts of the gig economy

Continuing to underpin the UK’s gig economy is Uber. The ride-hailing app now has at least 60,000 licensed private hire drivers on its system, with two-thirds of them operating in London, double the number of black taxi drivers licensed by Transport for London.

Piggybacking on its success has been Uber Eats, which has quickly outstripped Deliveroo and ranks behind only Just Eat among the nation’s most popular food and drink apps.

Deliveroo, meanwhile, counts at least 15,000 riders among its workforce, while Just Eat is now a FTSE 100 company with a £5.5 billion valuation – meaning it is worth more than Sainsbury’s.

And while business continues to boom for these companies, opportunities will abound for willing workers. Just Eat alone delivers more than 2 million meals every week in the UK.

Will willing workers continue to be found?

The appeal for jobseekers is threefold. Firstly, there is a clear need for them, and high demand for workers will always mean that people looking for work initially look in the most likely places.

Secondly, these are generally entry level roles that require no educational qualifications and little training. They are accessible to all and therefore have broad market appeal.

And thirdly, the nature of the jobs themselves can appeal. Working for the gig economy giants offers people a large amount of autonomy. You can set your own hours, be as flexible as you want or need and adjust your work to your life’s schedule. Few employers are able to offer such flexibility.

That said, the work is not for everyone. Stories abound of workers who feel compelled to overwork, to the detriment of their mental and physical health, in order to make a decent living. The gamified nature of the operating systems riders and drivers use to source their next job has come in for scrutiny and criticism.

Linked to this, part of the reason the sector requires such high, ongoing interest from jobseekers is the inevitable turnover in staff it endures. As few as 4% of Uber drivers remain on the app’s books beyond 12 months.

The gig economy is seldom seen as a place to build a permanent career. Most workers will know this, and will be doing it for short-term necessity or flexibility more than long-term gains.

At the same time, these apps have disrupted and transformed modern approaches to life, and as a result these companies are not going anywhere. There are other, far longer established, ways of both hailing a cab and ordering a takeaway. But the likes of Uber and Deliveroo changed the system, and it is unlikely it will ever change back.

While people continue, in such vast numbers, to use these apps, in turn these apps are going to need workers to fulfil this demand.

What this means is that the gig economy is here to stay – and therefore its need for staff will continue. Wherever there is the opportunity to make money, there will be jobseeker interest. Don’t expect it to slow significantly any time soon.

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