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Millennials Leading the Way to a Gig Economy

More than one-third of Millennials don’t have a “traditional,” full-time, 9-to-5 job with benefits. Instead, this generation is leading the rise of the “gig economy”. In this new post-recession environment, Millennials are trying to make ends meet and build a career through a variety of freelance and part-time contract jobs.

The term “gig economy” was first coined in reference to the days of 1920s jazz music, where musicians hopped from gig to gig, backing up singers and bands whenever they could to afford to keep playing music and stay on the road traveling. Today, it’s not just musicians performing gigs.

Why Gig?

Three main factors have pushed Millennials toward the gig economy: The economic/political climate, technology, and lifestyle preferences.

On the economic side, it’s all about the continued lack of job growth for Millennials. In the fourth quarter of 2015, Baby Boomers and older Gen-Xers were the ones that added the most jobs (around 378,000), while Millennials and younger Gen-Xers’ jobs shrunk by at least 35,000. Millennials were simply at the wrong place at the wrong time. To add insult to injury, many Baby Boomers are delaying retirement, which contributes to fewer jobs available for Millennials.

The Great Recession in the early 2000s occurred just as many Millennials were attempting to enter the workforce, which meant dismal job prospects and the delayed launch of Millennials’ careers. “The result has been a sizable population with no choice but to turn to whatever ‘gig’ comes their way in order to make ends meet,” according to a 2015 Fischer Phillips/Pew Research Center report.

A tiny bright-spot for Millennials was the passage of the Affordable Care Act, passed in 2010. This allowed Millennials to stay on their parents’ health plans till age 26. Sure, this is nice, but most Millennials would rather have a full time job and their own insurance, thank you very much.

Technology has also played a role in elevating the gig economy. Mobile connections and wifi have untethered workers from their desks, while social media and project management systems like Slack and Asana, online time tracking and remote desktops have made it easier to stay connected from afar. Combined with the growth of relatively new job markets like Upwork and Contently, which cater to freelancers and contract workers, it’s easier than even for Millennials to find remote work and be productive from anywhere. Millennials are quick adopters of new technology and are used to working from non-traditional offices and working on their own schedule.

Finally, for some Millennials, the lifestyle that a gig provides fits a type of lifestyle preference. Millennials famously value flexibility in their schedule and work environment — two things that gig economy jobs can provide. According to Millennials, the perks of being a full-time freelancer or relying on a series of contract jobs include freedom and independence that they believe a more traditional job may not provide, gaining a wide diversity of experience, having more chances to learn new skills on the job.

Why Not Gig

Despite the short-term benefits that a gig-job provides, most Millennials, given a choice, would rather have a full-time job with a salary, benefits, and an employer that invests in their personal and professional development. In fact, Millennials are more likely to prefer one employer that provides these benefits than start over every time with a new employer or gig. But for now, out of necessity, many Millennials are embracing the gig.

 

New Study: Millennial Males Worse off than Millennial Females

Millennial Males

The employment rate for young men declined from 84% in 2000 to 72% in 2012.

We’ve heard the refrain many times in the last couple of years– young adults are launching their careers later since the Great Recession of 2007-2008. While graduation rates and test scores go up, the ability to secure employment has gone in the opposite direction. According to a new Study from Georgetown University’s Center on Education and the Workforce, called “Failure to Launch: Structural Shifts, and the New Lost Generation“, Millennials are far less likely than previous U.S generations to be employed, and when they do become employed, their wages are lower. The study also points out the gender disparity, a disturbing trend that looks bleak for young males graduating from college.

Among the highlights related to gender differences:

1. Millennials, especially Millennial males, are taking longer to launch their careers. From the period 1980 through 2012, the age at which young adults reached the median wage increased from 26 to 30 years old. Meanwhile, older workers’ relative earnings are much higher over that same period of time. Good for Baby Boomers, bad for Millennials.

2. While young women have seen substantial growth in labor force attachment over the past three decades, coinciding with their enormous growth in post-secondary enrollment and educational attainment, young men’s labor force growth has gone down. Young men experienced the greatest declines in workforce participation and employment. Employment rate declined from 84% in 2000 to 72% in 2012.

3. The most common jobs for young adults are concentrated in low wage occupations such as cooks, cashiers, and waitresses. In 1980, young men made 85% of the median wage; In 2012, they earn only 58% of the median wage.

The authors of the report offer some suggestions on how to reverse the trend, focusing on investing in training and education programs for the young. But in today’s rancorous political environment, the likelihood of public sector investments in educational programs is not likely. This, combined with continuing economic malaise, we may be looking at one of the most fundamental shifts in employment trends in U.S. history– a long-term downward trend.

Is there a silver lining? The report points to three positive trends: “While the situation may look dire for today’s generation of young adults, there are several reasons for optimism. First, Millennials themselves are the most optimistic generation: 88 percent of 18- to 34-year-olds think they either have, or will have, enough money in the future to achieve their long-term financial goals.” Second, Millennials are the most-educated generation: 60 percent of women have attained at least some college credit, compared to 52 percent of women from Generation X and 34 percent of baby boomers at the same ages. Third, despite troubling trends in the labor market and changing sociocultural norms, Millennials’ median household income remains the highest of any generation at similar ages.”

This may not be solace for a 20-something who is working two part part time jobs, living in his parent’s basement’ however. We clearly have some work to do.

-Warren Wright
@MillennialCoach

http://www.CoachingMillennials.com