A lot has been said about the so-called sharing economy, and judging by how things are going, there's a lot more to come.
After all, the influence that it exerts over economies from all over the globe is now undeniable. This gig economy may have been born in the United States, but at the moment, the whole world is benefiting from the flexible opportunities that it offers.
Let's take a closer look at the sharing economy's contribution to the global economy.
Sharing Economy in China
Take China, for example. Until recently, China had relied almost solely on manufacturing to drive their economy.
It’s been predicted, however, that in a few years, the gig industry will become a much more important part of the Chinese economy.
Estimates are that over the next five years, the sharing economy will make up 10% of China's GDP. That's massive!
With China's growth over the past decade, the inclusion of the sharing economy is a disruptor for that country. One needs only remember the recent Didi-Uber merger for evidence of this.
Sharing Economy Growth
According to PwC. in less than ten short years, the sharing economy will be worth $330 billion.
Yeah, you read that right. The sharing economy is boosting economies worldwide as we speak, and if you don’t think that’s impressive, well, I don’t know what to say.
But I digress.
Sharing Economy in the U.S.
The U.S. Government Accountability Office has revealed in one of their recent reports that more than 40% of the workforce consists of what is referred to as 'contingent workers.' These workers are those who don’t hold traditional, full-time positions.
Gig workers! Sharers! Freelancers! Moonlighters!
According to another study conducted by McKinsey & Co, the number of contingent workers in the entire world lies between 20% and 30%. Not as high as in America, but worth considering.
I may be stating the obvious here, but online platforms are, and will remain, absolutely essential for the growth of our economy.
Sharing is Digital, and so are World Economies
Because the digital world has few borders, these originally U.S.-based companies are going global. And who can blame them?
The McKinsey study noted above predicted that in the coming years, all these platforms will keep growing at an impressive rate.
Specifically, more than 540 million people – that’s 10% of the world's working-age population – will be present on these platforms.
Global GDP Growth
And that’s by no means the only impressive statistic. By 2025, these platforms are expected to increase the global GDP by a whopping $2.7 trillion.
Not sure I can even count that high.
Wayne, I need more beans...
Employment will rise too. By 72 million workers!
Wayne, just bring the whole bag!
Without a doubt, this will be beneficial for countries with high levels of unemployment. Like Greece and Spain, for instance.
Sharing Economy Shifts Economies
As the sharing economy grows, the world will slowly shift from manufacturing-based economies, to ones that rely more on digitization, mobile technology, and underutilized assets.
And we couldn’t be more excited about this trend!
Because, this will facilitate robust economic growth. It will bring more variety to industries in which constancy has been, until not very long ago, more or less the norm.
Consider banks, or insurance companies. Outside of adapting to the online world, these industries have barely changed for decades - maybe even centuries. But, with the growth in online marketplaces and peer-to-peer connectivity, these industries are being disrupted as we speak.
The Chinese have jumped on this bandwagon, and in 2003 even created a national Department of High-Tech Industry.
Their National Development and Reform Commission formed it with a view to “promoting the formation of new industries” and “drafting key policies to promote the development of the high-tech industry.”
Final Thoughts and Continued Relevance
It becomes apparent that the rise in the sharing economy isn't a fad, but a continuation of the trend from a consumerism model based on ownership, to one of access. And world economies are clearly benefiting.
Flexible job opportunities also provide employment options for those in need, and help boost overall productivity of countries across the globe.
We are in a period of transition, and sometimes when you're in the middle of something, it's hard to step back and enjoy the scenery.
But, let me assure, the landscape is bountiful and the view extraordinary!