Various studies have highlighted the value many people place on the flexibility and autonomy inherent in the gig economy, which has resulted in several papers suggesting that gig workers are generally happier than their peers in salaried roles. Equally however, this is not a broad brush, with people at different stages of their life having different priorities.
For instance, those with mortgages and families to support have generally disliked the instability of gig work, not only due to the irregular incomes such work often affords, but the lack of benefits of salaried employment, such as holiday and sick pay. This is contrasted with greater autonomy, flexibility and possibly even favorable tax status.
Recent research from the London School of Economics explores worker preferences for the various forms of employment to see if any trends emerge. The study found that workers usually prefer jobs that have characteristics commonly associated with more traditional forms of employment, with a permanent contract the most valued form of employment by some distance.
Indeed, even among those people engaged in gig-like work, some 50% would rather have a more traditional kind of employment relationship. It’s a situation the authors believe reflects the necessity of gig work rather than the choice of gig work. In other words, they believe many gig works resort to it as they have no other choice.
Job choices
The findings emerged after participants were given a survey that offered them a range of fictitious job choices, each with various attributes. This allowed the researchers to ascertain the value people placed on each job characteristic, including the length of contract, holiday and sick pay, total working hours, autonomy and taxation implications.
The results reveal that workers seem willing to give up around 50% of their hourly income if the contract was a permanent one, versus a one-month gig. This is in large part because of the other benefits that permanent contracts afford, especially in the UK. These include unfair dismissal protection, redundancy pay and notice periods.
Holiday and sick pay was also something workers were willing to pay highly for, with the average UK worker willing to give up around 35% of their income for these perks.
Of course, there are aspects of atypical work that are valued too, with the ability to work from home rated most highly. Despite this however, the 24% of salary people were willing to sacrifice is less than for some of the benefits associated with permanent work.
Another interesting takeaway from the research is the limited understanding (or appreciation) of the tax benefits of self-employment, as very few of the respondents expressed a willingness to sacrifice income for favorable tax status, with this even true of self-employed people, who presumably work with this status to minimize their own tax liabilities.
The authors believe that their findings could have a number of implications. Firstly, they suggest that employers in the US could prove attractive to candidates if they offer some of the perks that are mandatory in the UK but largely voluntary in the US. Secondly, they believe that policy changes could be implemented to provide atypical workers with the kind of perks their salaried peers enjoy.
As gig and other forms of atypical work become more commonplace, it’s important that we get better at understanding their role and how people respond to them. This research is a welcome addition to the conversation.
