Tips and tricks to make money and profit from the gig economy

Patrick Ow
Oct 28, 2018 · 4 min read

The gig economy allows people to be masters of their own fate, which is to choose the work they do and for how much they perform the task for.

It’s all about flexibility, freedom, and choice.

There is no need for minimum or maximum hours, no obligatory peak-hour commute, no rigidity, and no workplace hierarchy.

The term ‘gig economy’ commonly describes peer-to-peer arrangements where for-profit companies create online platforms, or ‘marketplaces’, which pair workers with jobs.

Widely recognized examples include Freelancer, Fiverr, Uber, and Upwork.

The rise of the gig economy can partly be attributed to advances in technology that paves the way for new innovative ways of doing business and providing income for many people seeking additional money including employees with jobs.

A gig economy worker with specialized, in-demand skills may agree to sell their expertise to a customer that needs a task to be completed for a fee.

Those with less specialized skills can secure a short-term job, a ‘gig’, by selling their labor for less than their competitors without a financial safety net beneath them, or for people who make a living by stringing odd jobs together.

For a commission or fee, an online platform brings service providers and customers together.

Unfortunately, there is no limit as to how low fees can go. There’s no minimum amount a person can be paid to do a job as long as they mutually agree within a context of mutual buyer and seller.

As far as the platform provider and customer are concerned, the gig worker, or entrepreneur, is not an employee earning a fixed salary or wage.

Supply and demand market forces prevail. The worse or more desperate a person’s financial circumstances are, the less they might agree to work for the fee.

To many critics, the gig economy is dangerously unregulated and creates fertile ground for exploitation.

There’s no security of income, no insurance for the worker in case of an accident, no superannuation, and no personal, annual and paid leave of any description.

Here’s the reality.

We buy cheaper products made in less developed countries because we do not want to pay a higher price. Who wants to buy the same product in a local store when it could be purchased from Aliexpress.com for a fraction of the cost?

Naturally, we want the lowest possible cost.

Likewise, why would a customer turn to an established cleaning business which pays its workers at or above the award, superannuation, insurance etcetera, and therefore charges much higher fees when they can find a gig worker to clean their house possibly for below minimum wage?

For those wanting a life in the gig economy, it is vital for gig workers to fully understand how to make money in the gig economy, maximize their gig incomes, and minimize their risk, time and expenses in generating that income.

“Ride-share driver compensation — the income drivers get after deducting Ride-share fees and driver vehicle expenses from passenger fares — averages $11.77 an hour. This average Ride-share driver hourly compensation is substantially less than the $32.06 average hourly compensation of private-sector workers and less than the $14.99 average hourly compensation of workers in the lowest-paid major occupation (service occupation workers).” (Economic Policy Institute, 2018)

According to a study from the JPMorgan Chase Institute, drivers were earning an average of $783 a month in 2017 down from more than $1,500 in 2014. Ride-sharing drivers have seen their monthly pay-checks cut in half in the last four years.

The truth is that the gig worker must give the business the respect it deserves. Starting and running a business is not child’s play. It is a serious business.

Many people think that earning revenues is the key to their success. It’s not when we take the expenses side of the equation into account.

Gig workers can increase their profits by increasing the revenues received from their customers and reducing their expenses in delivering the services or products to their customers.

Depending on which platform or marketplace you choose to offer your services as a gig worker, you must always play the game to win.

Like in any game, there will be rules of the game to follow. There are strategies to maximize your chances of success and income for yourself.

Your goal is to spend the minimum amount of time on your gig work to earn maximum profits.

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For more information about profiting from the gig economy and understand some of the pitfalls to avoid, download your FREE Ultimate Guide — How to Make Money and Profit From the Gig Economy after you sign up.

Patrick Ow

Written by

Strategist and blogger at Allmoneymakingideas.com | Risk expert

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