Side Hustle vs. Entrepreneurship
American unemployment figures reached nearly 18 million as of June 2020, and an uncertain future lies ahead. Today, a steady income is hard to come by. People are turning to online and gig work at an unprecedented rate in order to pay their bills. When it comes to women, the gig economy falls short of what they need and solo entrepreneurship is often too hefty an investment. Instead, women are investing in new endeavors more suited to their lifestyle.
How gig work is changing the economy
The trend toward freelance and contract work certainly isn’t new. The “gig economy” has been booming, up 15 percent since 2010, with 43 percent of the workforce predicted to earn at least some income from gig work this year alone. Whether workers are considering using their personal vehicle for rideshare services like Uber and Lyft, delivering takeout and grocery orders through Postmates, pet sitting via Rover, or renting out their homes through Airbnb, everyone is looking for new ways to make ends meet.
While the uncertain job market, from stagnant wages to increased job insecurity (both major issues long before we’d heard of the coronavirus), has fueled this trend, the story of gig work comes with other perks. Take my dad. A workaholic for over 50 years, he struggled to find purpose and connect with others during his retirement. He felt like he’d lost his motivation, didn’t enjoy all the free time he suddenly had, and was driving the whole family crazy with his complaints. My solution was setting him up as an Uber driver, just to give him a reason to get out of the house. I even went with him on his first ride. Suddenly, he had the opportunity to socialize with new people, a renewed sense of purpose, and the option of making a little extra cash on the side. In true Dad (aka Papa Sigari) fashion, he turned a fun retirement gig into what many would consider a full-fledged career, booking almost six figures in income last year. And while my family might be amused by Dad’s newfound lease on life, he’s far from alone. Recent figures show that almost a fifth of gig workers are over 55.
When gig work doesn’t work
Gig work is great if you can succeed in it, but there are still barriers when entering the field (or industry), particularly for women. As a thirty-something woman, I’d be reluctant to drive strangers around in my car, and as a mother, I have to factor childcare costs into my working time. Data from Care.com suggests that childcare costs are increasingly unaffordable for low-, and even middle-income families, with 72 percent of parents saying they spend more than 10 percent of their annual income on childcare. Over half report spending in excess of $10,000 each year. For many people looking for work, joining the gig economy simply isn’t safe or cost-effective.
Instead, an increasing number of people are turning to online work and finding success in eCommerce. This trend is likely to continue as the pandemic has taken a toll on gig workers, with increased competition for gigs as a result of mass unemployment, coupled with a reduction in demand for services such as Airbnb and Uber.
Ecommerce is booming
Like gig work, eCommerce success stories are still exploding. By 2021, worldwide eCommerce sales are predicted to reach $4.9 trillion, and last year’s online spending accounted for 16 percent of the total retail market — more than $600 billion. Year-on-year, more consumers turn to online shopping for lower prices, greater convenience, and better variety than that offered by traditional brick and mortar stores. Heck, the world’s most valuable eCommerce company, Amazon, should be the best indicator of the surge.
Because of the eCommerce influx, opening an online store is now a viable business opportunity for countless people. From selling used or homemade goods on eBay and Etsy, to sourcing or creating product lines and launching them through independent websites, Amazon Merchant accounts and more, there are countless opportunities for individuals to create their own startups and run successful businesses online. And best of all, they can do it in their own time, without worrying about who’s going to look after the kids while they’re working.
Unlike service-based gig work, online businesses have a larger capacity for growth and expansion. What starts on a spare evening in front of the computer could become a multi-million dollar enterprise. Many gig workers are stuck with fixed rates that limit their potential — for every worker like my dad, there are a dozen who struggle to break even. In the two-year period up to 2019, the average gig worker barely earned $600 per month. And when you’re working gigs, you’re still employed by somebody else, rather than owning your business and truly being in control of your schedule and income.
Shopify, which provides a shopping platform to individual merchants and is the third-largest online retailer in the U.S. behind Amazon and eBay, reported a huge uptick in sellers joining their platform after the shutdown started. They grew from 820,000 in 2019, to now over a million online sellers who run independent eCommerce businesses. Shopify predicts that those numbers will grow to around 1.5 million by the close of 2020.
What’s holding would-be entrepreneurs back?
It isn’t surprising so many people have been quick to jump into eCommerce when looking for another source of income. After all, studies show that about two-thirds of Americans dream of starting their own business. Interest is growing with each generation, with 91 percent of Gen Z having ambitions of becoming entrepreneurs. However, while starting your own business is now easier than ever before, there are still barriers that prevent people from taking the plunge.
The Kauffman Foundation estimates that the cost of starting a business is around $30,000 — far more than the average person has available, given 78 percent of Americans live paycheck to paycheck. Startup costs can include product sourcing or development, manufacturing costs, inventory purchases, legal fees, marketing, branding, advertising, and more. Every step of the journey comes with a learning curve, stress, time commitment, and fear of failure. As a business owner myself, I know how hard it is to get a company off the ground, and many people simply can’t spare the time or money that a typical startup demands.
Bridging the gap between gig economy and entrepreneurship
Luckily, there is another solution. Network marketing enables individuals to start their own businesses without any of the usual costs and hardships that go along with starting a company. Independent consultants control their own businesses, while their partner firm takes care of product development, inventory, and distribution. Ultimately, network marketing bridges the gap between gig work and entrepreneurship.
A career in direct sales provides many would-be entrepreneurs with an affordable way to start their own business, and as such appeals particularly to women, who are often shut out of independent business opportunities because of safety concerns or childcare costs. Three-quarters of people currently working in direct sales are women, each earning their share of $35 billion in annual revenue. Unlike many other industries, network marketing revenue has remained steady through massive upheavals in commerce as a whole, making it a low-risk, stable option for people willing to become their own boss.
As a business owner and woman, I was inspired to follow in my mom’s footsteps in encouraging and uplifting women. I wanted to find new ways to give them independence in the workplace. My mother was a young social worker who ran shelters overflowed with women whose lives had been devastated by war. Many were widows of servicemen and they struggled to find work, leaving them trapped with no way to support themselves or their children.
My mother realized that if she taught the women a skill (in this case, sewing), they could work together to create products that she could sell in order for them to make money. Although Mom didn’t know anything about running a business herself, she trained the women, set up assembly lines, and secured contracts that provided a valuable lifeline toward financial freedom and independence. As a child, I was in awe of what she created, and remain committed today to continuing her work by equipping women with the skills they need to be successful in their own businesses.
Building a business that gives back by empowering others
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