Gig Economy Statistics & How to Reduce Churn Rates
The gig economy is a rapidly growing and extensive market that requires better payment management and protections for the millions of people who rely on it for their livelihoods.
The gig economy has seen significant growth, with nearly five million people engaging in gig work to make a living in the UK. It is a thriving and dynamic space that is most famously associated with companies like Uber and Deliveroo but is also thriving in the digital realm in online marketplaces and platforms.
Gig workers use online marketplaces and platforms to bid for jobs, connect with new customers, expand their reach into new markets, and build their skill sets. Gig economy examples range from drivers to gardeners to accountants to writers to cleaning and beyond - people can trade their skills for payment in multiple ways.
The Drivers of the Gig Economy in the UK
The current market is volatile and complex with the rising cost of living, the encroaching global recession, increased interest rates, and a fluctuating economy. It is a tough time for gig workers as they compete for attention in a very loud and competitive market, yet gig work remains immensely popular. In the UK, the gig economy has trebled in the last five years, with 22.6% of workers using a gig platform or marketplace.
Why so many individuals are opting for gig work
In a recent New York Times article, the reason put forward for gig work, even though it is challenging and offers little security, is because of its flexibility. Even as wage-paying jobs become more available with wages meeting inflationary demands, people are turning to the gig economy because it allows them the space they need to manage their lives. This is echoed by a recent Statista survey that found 71% of US workers chose the gig or freelance lifestyle because of the freedom it offers them.
The gig economy is also remaining popular because:
The cost-of-living crisis - people are using marketplaces to supplement their income streams to stay ahead of the current cost of living.
The rise of technology - thanks to accessible platforms and easy-to-use technology, people can find work easily.
The Impressive Gig Economy Statistics
The drivers of the gig economy are obvious, but the statistics are impressive. The gig economy is a thriving, growing, and evolving space that’s attracting talented people in the millions, and it is being enhanced by the evolving capabilities of technology and gig marketplaces and platforms.
Some of the most extraordinary gig economy stats are:
- A quarter of UK consumers took up a second job in 2022, and the most popular second jobs include dog walking (35.8%), delivery services (35.5%) and cleaning on demand (33.3%).
- 58% of gig workers rate being their own boss as the biggest advantage to choosing this lifestyle, 50% rate flexibility as the best part, and 43% rate the ability to choose what they do for work.
- 81% of companies use temporary labour to fill their skills gaps, and 38% think gig workers are more efficient.
- 58 million Americans identify as independent workers.
- 4.7 million people in the UK are engaged in the gig economy.
- The US is the highest global market, followed by India, Indonesia, Australia and Brazil.
- 50% of gig workers provide skilled IT, marketing, or computer programming services.
- 78 million - that’s how many gig workers are estimated to be working in 2023.
- 88% of the global gig economy volume comes from ride-sharing and asset-sharing platforms.
- £20 billion is now much gig workers contribute to the UK economy.
The Challenges of Churn in the Gig Economy
While the numbers paint a picture of a thriving and growing market, there is significant churn within the gig economy. While gig working gives people freedom and flexibility, it also comes with inherent risks. There are no benefits for gig workers, certainly not the same as those experienced by their full-time counterparts. There is no paid leave or sick leave, no insurance (unless they pay for it themselves), no maternity or paternity leave, and no extra benefits designed to woo and retain top talent in organisations.
This lack of benefits puts immense strain on gig workers and can lead to a lack of engagement and reduced service delivery. This is made even more complex by the fact that payments are often late, variable and complex. Payment platforms are not paying people fast enough, nor are they streamlining the payment processes, which makes it harder for gig workers to make ends meet. And this results in churn, which impacts the platform, the workers and the companies they serve.
Embedded Finance Can Transform Gig Economy Payments and Marketplaces
The gig economy market is a competitive space for those wanting to attract and retain gig worker attention, making the creation of easy payouts and payment capabilities an invaluable competitive differentiator.
If your gig marketplace or platform can streamline and smooth over the bumps traditionally left to trip up gig workers on the road to payment, they will be far more inclined to use your platform and provide exceptional service to their customers.
Using embedded finance that’s designed to transform payments from complicated into easy and rapid, you can engage gig economy workers and thereby build stronger relationships with the companies that use your service to retain and find the right talent.
How Rapid Payments and Easy Payouts Help Engage Gig Economy Workers
In fact, the benefits that come with providing rapid and easy payouts using embedded finance on your platform also include:
- Increased loyalty and talent retention - gig workers want financial stability, so ensuring that your platform provides this means that talent will opt into using your services and remain with your platform as it supports them and their financial needs.
- Reduced stress - gig workers are as stressed about the cost of living and making ends meet as anyone else, so if your payments are accessible and easy to use, they will appreciate one less stress on their plate.
- Improved cashflow and financial management - if gig workers can rely on you to streamline their payments through a reliable cashflow, then they will be more likely to stay with your platform. Knowing that they have a reliable cashflow and that payments take place in real-time means they can manage their finances more efficiently and that means more capacity for work and more engagement with your platform,
- Flexibility becomes entrenched - flexibility makes the gig worker choose this way of life, so if your platform can make payments quick and easy, you’re embedding flexibility into every aspect of their lives. It’s a perfect way to build a solid reputation and gig worker engagement.
The UNIPaaS Offering
UNIPaaS provides a trusted and proven embedded finance solution that has gained significant traction with leading brands and offers extensive customisation capabilities. Sitting on the edge of payment capabilities, it is revolutionising the embedded payment experience for B2B platforms.
With ready-to-use UI components for embedded finance, UNIPaaS simplifies the payment process and provides you with complete control over your platform’s capabilities. Using our trusted and reliable solution, you can walk away from expensive custom development projects and implement our components while enjoying all the benefits that come hand-in-glove with a customised white-label embedded finance solution. From customisation through to support, security, transparency, easy integration, and trusted service delivery, we simplify your service delivery and help you do more with and for your skilled gig workers.
Our features can be customised to suit the unique gig worker requirements, and our proven service delivery, support and payment security reassure you of uptime, functionality and safety. We are committed to reducing the risks, smoothing the road, and building an embedded finance solution delivers exactly what your platform needs in a way that is precisely what gig workers are looking for.