A phrase we hear a lot lately when it comes to the labor force is the "gig economy," the movement of employees making their living with multiple part-time jobs. A new survey released by Guardian Life Insurance Company of America looks at this growing trend of workers avoiding full-time work.
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The number of people opting for part-time employment increased over the last few years, making up 18.2 percent of the total U.S. workforce. Three-fourths of those seeking part-time work say it's because they want the flexible hours to improve their work/life balance.Record levels of "gig work" — part-time, independent, or contract jobs — were seen during the Great Recession in 2010.
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People working in hospitality are most likely to be working part time, with more than one-third of all employees doing so. Health and retail are the second and third most popular industries, with 23 percent and 20 percent part-time employees, respectively.
The report says the number of gig workers grew after the Affordable Care Act went into place, when people were able to access health insurance outside of an employer-sponsored plan.
While the ACA might've helped cover some gig workers, employer-sponsored plans and their benefits are coveted for a reason. Those who forgo a full-time job are financially vulnerable thanks to the lack of employer-offered benefits.
While 80 percent of full-time employees enjoy employer-sponsored health plans, only 25 percent of part-time workers do. If faced with a $3,000 medical bill, only 24 percent of part-time workers feel they could handle it.
When it comes to retirement, 32 percent of part-time employees benefit from an employer-sponsored retirement plan, as opposed to 69 percent of those who work full time. Perhaps this is why only 33 percent of gig workers are saving for retirement and only 35 percent say they have a financial plan in place.
When it comes to feeling financially secure, 52 percent of part timers with benefits say they do, compared to only 22 percent of those without benefits.
That feeling of financial security (or lack thereof) impacts generations differently, with 51 percent of Generation X part-time workers saying it's their top source of stress, as opposed to 29 percent of millennials and only 22 percent of baby boomers. Seventy-four percent of single parents working part time feel similarly stressed.
This wariness isn't unwarranted; 25 percent of part-time employees live in poverty, compared to 5 percent who work full time, cites the study.
While the report paints a grim picture for part-time workers' financial interests, gig work isn't going away anytime soon. Half of large businesses (1,000+ employees) plan to grow their part-time workforce over the next three years, and 35 percent of companies of all sizes say the same.
As the gig economy continues, employers may need to prepare themselves and their companies for changes if they want to keep good part-time employees around.
"If the part-time employment trend continues in an upward direction, more companies may feel competitive pressure to use employee benefits as a differentiator to attract and retain their top part-time talent, much like they do today for their full-time workforce," the study says.
"By extending some portion of their health and wellness services and voluntary insurance benefits to part-time workers, employers can better compete for needed part-time talent while also improving the productivity and well-being of their part-time population."
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