Gig economy creates demand for financial planning: BMO

Canada’s labour market is shifting to a gig economy at a “phenomenal rate,” a report from BMO Wealth Management says, revealing a growing group of workers with specific investing and retirement planning needs.

The report describes the shift from stable, permanent employment to a “gig economy” of contractors and freelancers working short-term gigs. BMO surveyed more than 1,000 small-business owners and found 40% identified as being part of the gig economy, currently or in the past.

Read: Learn how to help freelancers

More than half (60%) said they voluntarily chose self-employment, and the survey outlines some generational differences in the motivations.

For boomers, autonomy and control was the top reason (70%) for working in the gig economy, as they ease into retirement or supplement their retirement incomes. Gen Xers put balancing career and family needs (52%) as their top reason, while millennials have gravitated to the gig economy to make extra money on the side (53%) and as a temporary solution until finding a better job (30%).

Read: Millennials worried about financial risk in gig economy

The top challenges cited by gig economy workers include not having benefits (69%), not getting paid when sick (55%) and not earning enough (41%).

The new job economy has changed the way Canadians save and invest, said Joanna Rotenberg, group head of BMO Wealth Management, in a release.

“A change in the way Canadians hire or get hired means additional time and planning is needed for gig economy workers to achieve their financial goals,” she said.

Read the full report here.

Also read: Millennials’ views on saving, investing and job-hopping

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.