Can Retirees Thrive in the Gig Economy? Navigating a Changed Workforce The current discussion of the gig economy focuses on its negative impact, highlighting the drawbacks of independent contractor agreements and the greater uncertainty in online work. However, the gig economy...

The current discussion of the gig economy focuses on its negative impact, highlighting the drawbacks of independent contractor agreements and the greater uncertainty in online work.

However, the gig economy can mean something else for workers approaching retirement age. The benefits of remote work, independent contractor agreements, and other informal types of employment may outweigh their disadvantages.

Older workers often desire greater flexibility and autonomy. They also prefer part-time work over full-time employment. Many of those in retirement age or already retired use the gig economy to stay active and socially connected. These benefits usually take precedence over financial needs.

Usually, adults 65 or over have a nest egg and are covered by Medicare and Social Security. A steady income and typical benefits like unemployment insurance coverage may be less of a consideration than they are for younger workers.

Nowadays, many retirees are actively exploring opportunities in the gig economy. These gigs include ridesharing, freelancing, delivery services, online selling, and consulting. Retirees usually engage in such activities to supplement their retirement income or keep themselves active. In addition, others turn to consultancy to pursue their interests, meet new people, or continue to hone their skills.

Here, we delve into this new megatrend, discussing important insights and how retirees can maximize their earnings and well-being in a volatile employment landscape. We will also discuss handy tips for navigating gig platforms, which can be daunting for some older citizens.

With the gig economy, it is possible to break out of previous career constraints and juggle multiple income streams. It can be a gateway to new opportunities. Technology can make the journey more accessible, so we will explore the best tools to help accept payments or commissions, track earnings, boost sales, and market services.

The Growth of the Gig Economy

With the advent of the Internet, gig opportunities multiplied. Hundreds of millions of people currently engage in independent work—up to 162 million in the United States and Europe alone, according to the McKinsey Global Institute. The gig economy has opened numerous opportunities for small businesses to collaborate, innovate, scale, and stay competitive in a fast-paced global marketplace.

According to LinkedIn co-founder Reid Hoffman in his book The Startup of You, new work models offer advantages of scale and agility, which can go hand in hand in the networked age. Small companies can turn global from "day one."

The gig economy augments this idea by allowing small businesses and individuals to tap into the worldwide talent pool, breaking the barriers of traditional hiring practices.

How did the gig economy evolve?

Understanding how the gig economy got to its size and extent today will help us navigate it more skillfully.

The concept of gig work isn't new. Before the dawn of digital technology, people have taken on odd jobs to supplement their income. In addition, creative workers like writers, artists, and musicians often referred to their jobs as gigs.

However, its scale, nature, and scope in the last decade have been unprecedented. The advent of the internet transformed the nature of the game. The proliferation of digital platforms and applications provided a way to connect job providers and job seekers locally, regionally, and globally.

In the early 2000s, marketplaces like Craigslist and eBay were among the earliest glimpses of new connections, allowing people to offer goods or services on a temporary or contractual basis.

By 2005, Upwork — which was named Elance-o-Desk back then — launched. Upwork targeted the global workforce, offering freelancers and businesses unprecedented opportunities for hiring and collaboration. Upwork and similar platforms have changed how we perceive jobs and access to talent.

In 2009, another significant business model emerged. This time, it was ride services. Uber introduced the new concept of ridesharing with an app that brought on an entire fleet of gig workers and their personal vehicles. Uber set the stage for another revolution in gig opportunities, not just in transportation but in numerous industries.

Airbnb, the world's largest property rental app, was founded in 2008 and launched in 2009. By March 2009, it had 2,500 listings and 10,000 users. In 2024, it is a behemoth with over 7.7 million listings and over 5 million hosts in over 100,000 cities. Airbnb's user base totals approximately 150 million people who have booked over 1.5 billion stays globally. It's a staggering opportunity.

Along with the advent of such platforms and apps, the gig economy matured. More people started considering more flexible working arrangements and multiple jobs.

In addition, the new gig economy changed the types of jobs available. Gig work was no longer limited to freelance design, writing, or ride-hailing services. It included other kinds of work, such as programming, healthcare, marketing, education, and consulting. Each line of professional work promised an entirely new workforce, and the market ushered into the gig landscape.

Technology has been a catalyst throughout this transformation. Allowing new choices with simple downloadable apps on a mobile device has simplified job searches and enabled a higher level of customization of arrangements.

Moreover, businesses have also widened their search for talent.

Payment technology has likewise evolved with gig-related apps. Blockchain and the rest of fintech have simplified payments and made them globally accessible. Artificial intelligence (AI) could further boost the gig economy by assisting gig workers and making their work better and faster.

The Current Gig Economy

According to the World Economic Forum (WEF) 2023 Future of Jobs Report, the increased adoption of new and frontier technologies is the top macro trend driving business transformation at 86.2 percent, closely followed by broadening digital access. These macro trends will profoundly impact the job market and the nature of work.

Over 50 percent of the global workforce is estimated to be gig workers by 2025. What will this future workforce look like? It will be made up of a wider demographic. Young GenZers, millennials, Gen-Xers, and boomers will all share in this vibrant economy, proffering their skills and competing in a global marketplace.

The nature of work will transform for all types of workers. Seasoned experts will seek greater flexibility and autonomy, fresh graduates will seek flexible work arrangements as they pursue further education, and retirees will look to stay engaged socially and intellectually while sharing their lifelong expertise with organizations.

In addition, continued work is a new reality whether we like it or not. Global life expectancy has more than doubled since the beginning of the 20th century. It is forecasted to rise by at least four years between now and 2040.

With the trend toward longer lives becoming universal, people may have no choice but to work longer to supplement their income for additional years or decades. Inadequate savings is also an issue among people of retirement age. Rising inflation is sending the cost of living sky-high, causing retirees to worry about the sufficiency of their funds.

The gig economy will provide opportunities for those in regions facing economic challenges and job scarcity. It will open various professions to new arrangements, accommodating everything from contractors and freelancers to temporary or part-time workers. It will become an integral part of how the global economy functions.

Workforce trends: Gig work for older adults on the rise

A recent AARP survey of US workers aged 40 and older notes that flexible work hours have now become a requirement for 79 percent of older workers. Sixty-six percent of older workers also say they will only consider a new job if they could work remotely at least part of the time.

In addition, an overwhelming majority of older workers—90 percent—state that they require employment that provides meaningful work.

The pandemic changed perspectives on the nature of work and personal priorities. The high level of burnout experienced by older workers during the pandemic, especially caregivers, has resulted in work-life balance becoming a requirement for future jobs.

Among those aged 40 to 49, 53 percent are caregivers for an adult—usually a parent or spouse. Working remotely or having flexible hours has become more critical than ever. Twenty-seven percent of today's older workers are doing gig or freelance work. That number is higher for those aged 40 to 49, at 32 percent.

Regarding work motivation, 87 percent consider flexible work hours a critical factor, second only to making extra money at 89 percent.

Other key findings from the AARP Value of Experience survey include:

• Continued prioritization of competitive pay (87%) and job stability (88%) among older workers despite a rising emphasis on work-life balance and flexibility.
• Job security is a top concern among older workers. Thirty percent believe they could lose their job within the year due to a weak economy.
• Other considerations for job acceptance include pension benefits, retirement savings, and the ability to phase into retirement.
• Age discrimination is a top reason (37%) for older adults' lack of confidence in finding a job in three months. Sixty-four percent believe older workers face age discrimination in the workplace—moreover, 94 percent view ageism as commonplace.
• Forty-one percent report experiencing ageism at work in the last three years. Only 13 percent filed a formal complaint to their superior.

AARP Vice President of Financial Resilience Programming Carly Roszkowski adds that the older workforce will grow significantly over the coming decade.

A keen understanding of the needs of older workers, including those of or approaching retirement age, will benefit both workers and their employers. It helps define new working conditions, including providing paid caregiving leave to maintain competitiveness, productivity, and high job satisfaction.

Types of Gig Platforms

To navigate the gig economy savvily, you'll need to understand the kinds of gig platforms or apps available. Digital platforms are the behemoths mediating the gig economy. They can be classified into two categories: niche-specific and general platforms.

General gig platforms

General gig platforms offer a wide range of job opportunities. The list includes thousands of freelancers posting diverse skills and services. These platforms are designed to be a one-stop hiring and recruitment hub for businesses seeking varied skills. Examples of general gig platforms are Fiverr and Upwork.

Niche gig platforms

Niche gig platforms cater to specific sectors of the job market. These sectors could include design, software development, finance, product, and project management. The platform 99designs, for example, caters exclusively to graphic design services.

Other gig categories

The gig economy is not just about freelance work and recruiting. It can enable you to leverage your assets and, in a sense, be your own entrepreneur without investing too much. Uber and Airbnb, for example, let people turn their cars and homes into new income streams.

Moreover, gig platforms can also be used as fundraising engines. Indiegogo and Kickstarter help you bring your business ideas and inventions to life.

Thus, the landscape of the gig economy is constantly changing and expanding, including new categories of work and providing people with more options to earn income. Gig platforms allow businesses—especially small businesses—to access capital, support, and talent. These platforms increase agility and competitiveness while reducing costs.

They signal many opportunities for retirees looking to embark on a new project or employment outside conventional roles.

Benefits of the Gig Economy

Gig work confers several benefits to individuals and society. Retirees who own or plan to establish small businesses can work around resource constraints to grow and become competitive.

Cost savings and minimal overhead

Retirees setting up a new business and team will face overhead costs, including equipment, workspace infrastructure, salaries, benefits, training, and more. With gig workers, retiree-owned companies will only pay for the work done.

In addition, as most gig workers are employed remotely, the company saves on equipment and office space.

Reducing overhead costs can lead to substantial savings for businesses, allowing them to allocate capital to other priorities.

Opportunity for innovation

Retirees with consultancies and small businesses can turn to digitization.

Given that gig workers work through digital platforms, it makes sense to set up an entire digital infrastructure around the company that helps boost productivity, efficiency, and innovation.

Using reliable point-of-sale software to solve small business requirements, for instance, enables customized tech, sales tracking, inventory management, financial data analysis, and support for all types of businesses. Even if you are starting fresh from retirement, you will immediately benefit from the automated POS system, reducing the need for manual processes.

Even as a consultant, you can customize your POS system to accept payments according to your unique business requirements.

Speed and efficiency

Online job platforms are a quick way to hire people or assemble a team for a project. It is a fast and efficient way for job seekers to be visible to as many employers as possible. It connects thousands of businesses, projects, and individuals in an instant.

Scalability and flexibility

Time is one of the most valuable things for retirees. The gig economy creates flexibility that allows for better time management, enabling better work-life balance. Digital platforms allow individuals and businesses to operate on a much larger scale. Those seeking to maximize income by accepting more than one gig will find opportunities in multiple job sites and platforms.

For retirees starting new businesses, the gig economy lets them adapt swiftly to changing market conditions, enabling them to scale their workforce up or down as needed.

Moreover, gig workers and business owners in the gig economy can adjust to demand fluctuations and seize growth opportunities on the fly.

Better diversity in the talent pool

While it is not possible to eliminate ageism and other forms of discrimination in the modern workplace, the nature of gig work allows employers to select from a more diverse pool of talent.

As many gig positions are remote or digitally enabled, the worker's age is often disregarded in favor of skill, experience, and the ability to deliver. Other forms of gig work utilize the worker's assets, so ownership—not demographics—is the main factor.

Risk mitigation

The gig economy has risk mitigation features for employers and workers. Full-time work can be a significant commitment for retirees who own or set up businesses and may involve risk. Gig work enables companies to test out workers for roles without a long-term commitment.

For freelancers unaware of the working conditions and team dynamics, gig work can be a relatively safe way to test out the employer without sticking to long-term obligations.

Income maximization

Working on two or three projects simultaneously is not uncommon for gig workers. Those who can balance their time and efficiency can make the most of the gig economy by picking the most profitable gigs and expanding them like a business.

Gig workers who own assets can also expand their rental properties by listing more on the platform. If the expansion is successful, this allows multiple income streams.

Core business function focus

Retiree business owners have the advantage of outsourcing non-core tasks to gig workers. This strategy frees up time, labor, and resources to focus on the company's core business functions, potentially enhancing productivity.

How Older Workers Can Maximize Income in the Gig Economy

The gig economy is built to accommodate older workers in many ways. However, as an older worker or retiree looking to extend work, you must strategically use it to your advantage.

Not every gig is suitable for you. Essential considerations include health and overall well-being, time, flexibility, expertise, and others. Here are some tips to navigate and thrive in the global gig economy:

Protect yourself

Whether you are interested in short-term projects, becoming a flexible gig worker, setting up a consultancy, or launching your own business, first things first: ensure your protection.

If you're launching a small service business or consultancy, for example, where you offer your time and services for a fee, you could register as a limited liability corporation or LLC or as an S corporation under the IRS.

However, take your time with the paperwork. Make sure it's necessary for the kind of work you plan to do. When you're starting, keep things as simple as possible. If you offer a product or service not covered by insurance, you could discuss matters with a lawyer. The few hundred dollars you spend consulting a lawyer could be worth it if you are adequately informed of how to structure your consultancy service or small company and thus can correctly map out how you move forward.

Consider the tax scenario

When you're anxious to start a new gig, taxes are probably the last thing you want to consider. However, taxes should be paramount, as earning extra income may lead to higher taxes.

Part of gig work is preparing for tax season. Keep your business bank account or gig project account separate from your personal account. As a retiree, you may have a steady income from a pension or other instruments.

However, any gig work needs to be accounted for separately. Talk to an accountant to ensure your gig work doesn't give you unnecessary tax issues. Using inexpensive tools like spreadsheets or accounting software can also help you keep track of your income. You can compute whether you make or lose money with your gigs or side hustles.

Choose the right project to work on

Once your taxes and paperwork are properly settled, you can consider which gig projects, clients, or markets to pursue. In retirement, you can be more creative with your work setup. Your choice of gig will depend on many factors, including your income goals, skills, personality, resources, and preferences.

Spend enough time looking at job listings and talking to your contacts. Avoid jumping on the next project immediately, even if it is tempting or you urgently need the money. At the very least, pause to see if the gig is a good fit. Going down the wrong path might cost you valuable time or discourage you from exploring the gig economy further.

Compare platforms and see which projects appeal to you. For example, driving for a rideshare app might be a fun side hustle if you own a four-door car and feel comfortable chatting with strangers.

If you are a copywriter, voiceover artist, graphic designer, or do any kind of creative work, you can freelance on Upwork or Fiverr. Babysitting is not just for teenagers. As an older worker, you can look at sites where you can be part of a household as a nanny, especially if you have First Aid and CPR certifications.

Retirees with properties can rent out their homes on VRBO or Airbnb. The income from these rentals can support daily living expenses or even luxuries like travel.

To sign up for these platforms, you need high-quality photos of your home or apartment and an appealing description.

Additionally, you need to plan out amenities and find ways to create a high guest satisfaction rating.

Leverage your highest-earning skills

As a retiree, you have decades of experience behind you. If you have specialized knowledge and lots of management experience, you can leverage these and go for a consultancy gig. You can take on multiple clients and charge a premium. The advantage of consultancy is that you are in charge of your calendar and can take on as few or as many clients as you like.

If you've been dreaming of starting your own business, the gig economy is an excellent way to hire exceptional talent to support your new endeavor while minimizing cost. Whether as a worker or entrepreneur, there's something in the gig economy for everybody.

To Thrive in the Gig Economy: Adapt, Re-skill, and Upskill

The line between work and retirement blurs in today's changing economy. As a result of longer life expectancies, those of retirement age may expect to work in one way or another to supplement income and stay active to support their well-being.

Technology's disruptive impact means the nature of work is changing, too, and that could be good news for older workers. With greater flexibility and opportunity for scaling, retirees could expand their gigs or side hustles and earn sufficiently.

Moreover, retirees hoping to start businesses will find the gig economy a cost-effective way to find the best hires. Those with cars or properties can leverage their assets to earn part-time and add to their income streams.

In the gig economy, the world is your oyster. It doesn't matter which demographic you belong to.

However, you must continue understanding the job landscape, adapting to technology, learning, re-skilling, and up-skilling. Adaptability ensures employability and continued relevance in the job market. Armed with a smartphone, you can start a new career and explore new ways of harnessing your talent.

Featured Image Credit: Photo by Markus Winkler; Pexels

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