Multilingual Matters: Closing the Savings Gap in the Gig Economy
In the U.S., 29% of all workers use gig work as their primary source of income.
Gig workers complete short-term, freelance, or independent contract projects, oftentimes instead of working traditional full-time jobs. Common platforms for the gig economy include rideshare, delivery, and task manager apps, as well as online freelance hubs for creative or consulting assignments.
Despite the growing importance of the gig economy, workers in this field have very limited access to vital workplace benefits and face significant financial struggles. In fact, more than half of gig workers lack access to any employer-based benefits.
In this industry spotlight, we’ll discuss how multilingual, holistic workplace benefits can expand workers' access to savings, decrease turnover, and increase their financial well-being.
Workforce Overview: Demographics, Access, and Opportunity
Demographics of the Gig Economy
The gig economy is powered by an ever-changing workforce that ranges in age, background, language, and more. However, overall trends show that workers from common delivery or task apps are more often younger immigrants and women when compared to the broader workforce.
| Category | Gig Workers by the Numbers |
|---|---|
| Age | |
| Migrant Status | Migrants make up a majority of the gig workforce and are more likely to participate in the gig economy than native-born workers. This number is especially impacted in large urban cities like New York City, where 86% of app-based rideshare drivers are immigrants, with half coming from the Dominican Republic, Haiti, Pakistan, India, and Bangladesh. |
| Ethnicity | Workers from underrepresented racial and ethnic groups are more likely to hold gig jobs that tend to pay less and offer limited flexibility. While 30% of non-minority workers have earned money through gig work, this total increases to 48% for minority workers. |
| Gender | Men represent more of the workforce in the transportation sector and are more likely than women to rely on gig work full-time. Women are more likely to earn money selling goods, leasing assets, or performing other services. |
| Education | Workers with less than a high school diploma were much more likely to work gig jobs that earn lower wages. |
Financial Wellness is a Concern for Gig Workers
37% of participants in a recent survey said gig work was their primary source of income, and more than half of millennials (55%) used gig work as their primary employment and income. This trend has a concerning impact on financial wellness because of the irregular and often low pay for many gig workers.
Large Gaps in Income for Gig Workers
Despite 36% of Millennials and 21% of Gen Z gig workers reporting earnings of more than $5,000 per month, this is not the case for the entire gig economy. Two-thirds report earnings under $2,500 per month, and 14% of gig workers reported that they earned less than the federal minimum wage of $7.25 per hour.
Some employers, like rideshare apps, have historically claimed drivers can earn up to $90,000 annually, but this number is often exaggerated. The median income in several large metro areas is significantly lower, as shown in the table below.
| Region | Median Earnings After Expenses |
|---|---|
| Seattle app-based rideshare | $9.73/hour |
| Chicago app-based rideshare | $12.30/hour |
| New York City app-based rideshare | $13.76/hour |
| New York City app-based delivery | $7.94/hour |
| National app-based rideshare (Uber only) | $9.21/hour |
| National app-based rideshare | $3.37 to $8.55/hour |
One reason for such low pay averages is that gig workers often lose earnings because of “technical difficulties clocking in or out” of work, and more than one-third have lost pay three or more times.
Low and inconsistent income causes significant financial hardship. In a recent survey of gig workers:
- One-third were unable to even afford their full utility bill
- Report being more likely to live in a household where medical care was avoided because of the cost
- One in five went hungry in the last month because they could not afford enough to eat
- 30% used the Supplemental Nutrition Assistance Program (SNAP) in the last month, more than twice that of W-2 workers
In addition, minority workers earned just 91 cents for every dollar their non-minority counterparts made.
Lack of Access to Workplace Savings Plans
Young workers who use gigs as their sole income are less likely to have access to benefits than gig workers over age 55.
Even if benefits are available, gig workers are typically not eligible for employer-provided benefits or Social Security payroll deductions. Only 23% of gig economy employees were eligible for workplace retirement savings, and even fewer (18%) participated. This contrasts with traditional worker averages, where 47% were eligible and 43% participated.
Additional Difficulties with Language Options
For workers who do have access to workplace savings benefits, participation is directly influenced by language availability. Gig platforms offer a variety of languages in order to attract more workers who cannot communicate fluently in the local language. This can have a severe impact on participation, as many gig workers may not understand the benefits available to them.
Opportunities for the Gig Economy to Move Forward
Recruiting and Retaining Workers Through Workplace Benefits
While gig work can provide unmatched flexibility for workers, turnover is high. On digital gig platforms, one in six workers in any given month is new, and more than half of workers leave gigs within 12 months. As a result, employers must continuously attract new talent or increase the engagement of existing workers in order to grow.
Offering workplace benefits provides a competitive advantage in this tough job market. Working with a provider that supports comprehensive, multilingual workplace savings opportunities can significantly help employers in the gig economy:
- Enhance employee engagement by providing essential benefits in the primary language of your workforce.
- Decrease turnover and increase loyalty by offering resources workers need in the language they know best.
- Stay competitive in the marketplace, attracting workers who seek benefits that meet their unique needs and the stability workplace savings programs provide.
- Enhance both financial and overall well-being for workers by mitigating stress and alleviating financial struggles.
How Vestwell Powers the Gig Economy
Vestwell puts vital benefits within reach for gig workers without adding extra administrative burden for employers:
- 18+ Platform Languages and Support in 240+ Languages – Vestwell’s multilingual platform supports 18 languages and counting, overcoming one of the biggest barriers to participation. Workers can enroll and save confidently in the language they prefer and get the support they need in 240+ languages.
- Essential Benefits for Gig Workers – Vestwell provides holistic workplace benefits that help you attract more of the employees you need. Support employees with Emergency Savings Accounts that help them face unexpected financial challenges and empower workers to take control of their finances with Student Loan Repayment options that can help them get debt-free faster.
- Seamless Payroll Integrations – Focus more on your business and automate employee contributions with Vestwell’s seamless integrations. We have partnered with nearly 200 payroll providers to enable accurate and automatic contributions. Now it’s easier than ever to offer accessible, multilingual workplace savings benefits to your entire company.
- Mobile On-the-Go Access – Savings tools need to meet gig workers where they are— constantly on the move. Vestwell’s mobile app gives gig workers the ability to view balances, adjust contributions, and manage their accounts anytime, anywhere.
- Low Administrative Lift – Designed for operations of all sizes with unique needs and no benefits experience, Vestwell’s platform keeps things simple. Streamlined onboarding and minimal ongoing management offer high-impact workplace benefits.
Creating a Stronger Financial Future
Vestwell combines industry-leading technology, multilingual savings tools, and mobile-first access to help employers of all sizes strengthen their business and put employees on the path to long-term financial stability.
For employers in the gig economy, offering comprehensive benefits provides a powerful advantage—helping retain workers and reduce costly turnover. Make it easier to grow your business by attracting top talent and keeping your best employees through better workplace benefits.
