What is a gig economy business

Gig economy

Table of Contents

  1. term
  2. Origin of the term
  3. features
  4. Critical discussion


The gig economy describes a part of the informal labor market in which temporary jobs are given flexibly and at short notice to job seekers, freelancers or marginally employed people. An online platform serves as an intermediary between the client and the contractor. This defines standards and conditions of participation and calculates a commission for the successful mediation of supply and demand.

Origin of the term

In the music industry, the term "gig" denotes the individual appearance of an artist or a band without a contractually agreed follow-up engagement with the organizer. In analogy to this, Gig Economy stands for the placement and fulfillment of individual orders without a guarantee for follow-up orders that goes beyond the individual order. The term established itself with the market penetration of online platforms for food delivery services such as Deliveroo or Lieferando and for transport service agencies such as Uber or Lyft. There workers are usually not permanently employed, they do not receive a fixed income, but are remunerated per job (gig). There is now a wide range of uses with platforms for providing domestic help, cleaning and craft services, furniture assembly, gardening, design, word processing and translation services.


The gig economy serves the supply and demand for flexible employment relationships with a low degree of loyalty. Clients make their personnel costs variable and save social contributions that would consist of contributions for health, unemployment and pension insurance in the case of permanent positions. Gig workers are not entitled to paid vacation or sick pay. You are solely responsible for the fulfillment of the order and are also referred to as solo self-employed, as they do not employ any employees. In addition to their labor, they provide their own resources such as vehicles, bicycles, tools, mobile phones and PCs.

Critical discussion

The gig economy platforms see themselves only as a contract broker and not as an employer. However, there are more and more employment relationships in which dependent, instruction-bound employment is no longer clearly differentiated from independent and self-organized commissioned work. This is particularly the case when gig workers such as bicycle couriers work almost exclusively for just one switching platform, are economically dependent on this as the main source of income and are monitored, controlled and sanctioned in their activities.