As the world of work continues to evolve, more people are turning to gig work as a way to make a living.

Why it matters: According to a recent study, 59 million Americans worked in the gig economy in 2020. Gig workers contributed an estimated $1.21 trillion to the overall economy that year. The researchers speculate that by some point this year, 52% of the US labor force will have participated in the gig economy on some level.

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Gig work (also known as freelancing or independent contracting) is a type of work arrangement where individuals are hired on a project-by-project basis rather than being a full-time employee. Gig workers are typically self-employed and can work for multiple clients at once, which gives them more flexibility and control over their work schedules.

Examples of gig work include copywriting and editing, graphic design, web development, consulting, and driving for ride-sharing services. In many cases, gig work can be done remotely, which means that individuals can work from anywhere with an internet connection.

Benefits and downsides of the gig economy

While gig work is appealing to many people, there are downsides. An important one to keep in mind is that gig workers are responsible for their own taxes and benefits. Traditional employees usually have taxes withheld from their paychecks and are eligible for benefits like health insurance and retirement savings plans. Gig workers, on the other hand, are responsible for paying their own taxes and don’t have access to these benefits unless they purchase them on their own.

Despite the lack of traditional benefits, there are many benefits. Gig workers have the flexibility to choose when and where they work, which can be a huge advantage for those who value work-life balance. They also have the freedom to choose which projects they work on, which means that they can pursue work that aligns with their interests and skills.

Gig work can also be a great way for individuals to earn extra income on the side or to transition into full-time self-employment. For many people, gig work provides a way to build a portfolio of work and develop valuable skills that can be used to pursue other opportunities in the future.

5 tips for earning the most out of gig work

Sign up for multiple gig platforms

One of the best ways to increase your earnings is to sign up for multiple platforms. For example, if you're a delivery driver, consider signing up for both Uber Eats and Grubhub. This allows you to accept more jobs and earn more money. You can also consider working in varied industries, such as copywriting during the day and doing seasonal accounting work in the evenings.

Take advantage of peak hours

Gig work often pays more during peak hours, such as lunchtime or dinner time. Some platforms also offer surge pricing, which means you can earn more for completing jobs during busy times. Most of these gigs are in the service industry, whereas other industries are deadline-oriented, which gives you more flexibility in terms of times of day you choose to work.

Be efficient and work smarter

Efficiency is key when it comes to maximizing your earnings as a gig worker. Use a GPS app to plan your route and save time, and try to accept jobs that are close together. Additionally, consider ways to streamline your work, especially if you’re employed in different industries.

Upsell and add extra services

Many gig platforms allow you to earn more money by offering additional services or upselling to customers. For example, if you're a delivery driver, you could offer to pick up additional items with the order. If you're a pet sitter, consider offering grooming services in addition to basic pet care. Once you build trust with a company, it’s easy to move laterally and secure more work from them as well.

Manage your finances effectively

Finally, it's important to manage your finances effectively as a gig worker. Set aside money for taxes and be prepared for slow periods. Consider opening a separate account for gig work to keep your finances organized.