In this 2016 publication on the future of work, the European Commission defines the gig economy as an economy in which digital technologies enable teams to be assembled around a given project – and often across borders – while platforms seamlessly connect buyers with sellers. The Commission also notes that much of the latter takes place under the heading collaborative economy which offers opportunities not only to people seeking more flexibility in their work, but also to those who have often had fewer chances of obtaining a permanent job. Several national researchers (for example, Botsman, 2015; Frenken, 2016; Schmidt, 2017) apply a more limited definition of the gig economy, by referring only to tasks commissioned through online platforms but realised in a local/physical environment (such as ride hailing, delivery services or domestic services) rather than (also) online.
The Commission argues that the gig economy has created a dynamic environment in which temporary positions are common, and organisations contract with independent workers for short-term engagements. Tasks can be broken down and distributed even more widely through apps and online platforms.
The bidding-style process through which tasks are offered, assigned, and performed allows for real-time, interactive and an often mutual rating of the performance of service providers for seller and buyer, and the reliability of users. The gig economy can also offer ways to tap into talent, services and expertise at a global level with unprecedented affordability and transparency while rewarding the reputation, demand and compensation of the best performers.
There are, however, concerns about those working in the gig economy, in terms of their risk of job precariousness due to factors such as:
- unstable working hours and income;
- lack of coverage of employment rights;
- uncertainty around social security and pensions;
- lack of access to career development and training.
EPSC Strategic Notes are analytical papers on topics chosen by the President of the European Commission. They are produced by the European Political Strategy Centre (EPSC), the European Commission’s in-house think tank.