Construction Law

Pros and Cons of the Gig Economy as Related to the Construction Industry

In 2018, the Bureau of Labor Statistics reported that over 35 percent of people in the United States were classified as “gig workers.” But what exactly is a gig worker? And how do they relate to the “gig economy” as a whole? According to Merriam-Webster, the gig economy can be defined as “economic activity that involves the use of temporary or freelance workers to perform jobs typically in the service sector.” Which means gig workers are essentially freelancers, independent contractors, or those holding part-time jobs.

You might be visualizing gig workers as Uber drivers and substitute teachers, but gig workers are also an important part of the modern construction industry. In this article, the Naples contractor lawyers at Cotney Attorneys & Consultants will discuss the pros and cons of the gig economy as related to the construction industry. If you employ workers who don’t work a typical 40-hour workweek, consult a Naples contractor lawyer to ensure that you are maintaining compliance with all Department of Labor (DOL) regulations. Keep in mind, worker misclassification is one of the fastest ways to compromise the success of your contracting business.

The Pros of the Gig Economy

First, let’s start by discussing some of the pros associated with the gig economy. As noted by Construction Business Owner, companies that rely on gig workers are “able to run leaner operations” than their competitors. By hiring during high demand periods, you can cut down on payroll costs and increase your supply of liquid capital to bid on more projects. It can also help you mitigate talent-management overhead such as recruitment costs and time, human resources processing, benefits and salaries, and more. If a worker isn’t up to snuff, you can let them go without investing additional resources. Finally, it actually increases the availability of labor since many millennials embrace work flexibility and mobility. On the other hand, skilled workers who want to diversify their workload or obtain a greater degree of control over their work schedule are often keen to enter the project site through the gig economy.

The Cons of the Gig Economy

While the benefits of the gig economy can’t be overstated, there are some definite downsides to embracing this new working ideology. For starters, gig workers are typically less engaged than their full-time counterparts. This can lead to a lack of motivation as these workers often feel sequestered to a single task and don’t feel like a true part of the team. This can lead to subpar work and conflicts with senior employees. Focusing on acquiring skilled talent could lead to an influx of skilled but lazy workers. You will have to keep a close eye on your gig workers to ensure that they aren’t compromising the quality of your projects. Lastly, gig workers can leverage other employers against you to increase their wages, especially if they are knowledgeable about the current labor shortage plaguing the industry. Therefore, contractors should keep an open mind while maintaining realistic expectations when hiring gig workers. If you plan on hiring gig workers, consult the Naples contractor attorneys at Cotney Attorneys & Consultants to ensure that you are following all DOL regulations regarding these workers.

If you would like to speak with a Naples contractor attorney, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.