Freedom at a price

Avoiding the perils and pitfalls of the gig-based workplace

‘SOMETIMES there’s money and sometimes there’s not. It’s feast or famine,” says graphic designer Charl Kroeger, who’s been a freelancer for the past 16 years following a layoff from a Fifth Avenue design agency.

Kroeger is part of the growing number of independent workers who make up of the growing gig economy. A recent McKinsey Global Institute report found that up to 162 million people in Europe and the US — about 30 percent of the working-age population — engage in some form of independent work.

While Kroeger has found gig work satisfying, there are numerous downsides, including the absence of health insurance and other benefits. Plus, according to a study by Prudential, average freelance pay is also lower than for traditional employees.

“There is a fundamental instability,” says Matthew Bidwell, associate professor of management at the Wharton School. “You don’t know where your next job is coming from.”

Included under the gig -worker umbrella are those with traditional part-time jobs. Brianna Caza, associate professor of organizational behavior at the University of Manitoba, says these workers often have multiple jobs thanks in part to the rise of employment apps such as Uber and TaskRabbit. This can lead to “people battling with significant identity concerns, almost an identity crisis — you may be doing it today and not tomorrow,” Caza says.

Despite these downsides, many in the gig economy are much more satisfied than their corporate counterparts, reports a new in-depth study published in Administrative Science Quarterly. Researchers found that these successful giggers accept the anxiety of up-anddown work, embrace a never-ending need to hustle, have a web of supportive social connections, and have a purpose in their work.

One key is to develop an “importance of place” that provides a sense of structure despite not going into an office each day, says Susan J. Ashford, co-author of the study and chair of the management and organizations department at the University of Michigan’s Ross School of Business.

A sense of routine is a factor for success, as is creating a financial cushion for lean times.

“They invested in networking and developing new business even at times when they felt they had enough,” says Gianpiero Petriglieri, an associate professor of organizational behavior at INSEAD business school and also an author of the study. “They all felt ‘I better hustle.’ ”

Here are a few strategies:

Diversify and network

Develop multiple skills that could be used in a number of positions, such as developing interpersonal communication and digital literacy, in order not to put “all of your eggs in one basket,” Caza says.

Create a social support network, she adds, which can connect you to job opportunities and also help psychologically “by providing emotional support through the hard times.”

Get your money straight

Gig workers need to be proactive in saving for retirement, yet only 16 percent of independent workers have a retirement savings plan, according to Prudential. Independent workers should explore retirement savings options including a traditional or Roth IRA, or a self-employed 401(k).

Join together for better benefits

Freelancers Union (FreelancersUnion.org) provides insurance and retirement information with links to resources for its 350,000 members. The Union also has a monthly networking group called Spark, with meetings in Manhattan and Brooklyn.

“Many freelancers often feel they are on their own to figure out all these things,” says Caitlin Pearce, executive director of Freelancers Union. “And the most important thing is for them not to do it on their own.”