A growing number of employed individuals across Australia are no longer employed in jobs with a long term connection or engagement but are continuously opting for flexible employment engagements as independent contractors. This employment design called gig employment is usually for a brief period of time with leading to a termination of a contract between the employer and the employed (Friedman, 2014). The concept borrowed from music according to Friedman (2014) has further evolved owing to the adopting of internet-based platforms to link employers and employees allowing more freedom in the economy. This essay focuses on the analysis of the growing trend of the gig economy in Australia in relation to economic freedom associated with the framework.

Freedom and flexibility in the gig economy is a factor driving the growth of the economy. The new gig economy framework where individuals are able to access services offered through apps and the internet has been able to liberate markets into allowing mobility of factors of production. The freedom of employees to alternate between jobs as dictated by demand and supply forces enables individuals to produce where they are most efficient at. This factor is playing part in increasing the productivity of individuals as they only in areas where they are better suited. As such, employers are increasingly realizing increasing savings from the contacting of employees on a short period of time. While this might be a cost-efficient on employees with lack of social; wellbeing factors such as pension and superannuation funds, the move is time and financial cost-effective for employees. The freedom for employees in alternating between jobs increases the uncertainty, economic risks as well as the expected earnings (Friedman, 2014). With the economy resulting in highly variable employment and incomes, workers are increasingly working hard to compensate for the down times increasing the overall productivity in the economy. The lag in the social policies relating to the new economy pushes productivity up from uncertainty in the market. The growth of the gig economy is therefore inevitable owing to the competitiveness arising from these factors as well as the productivity realized.

References

Friedman, G 2014, ‘Workers without employers: shadow corporations and the rise of the gig economy’, Review of Keynesian Economics, vol. 2, no. 2, pp.171-188.