Let me preface this by saying do what you need to do to get through the day. I don’t begrudge anyone a way to make a living. That being said jobs exist on a continuum and there are better and worse ways to make a living even within a vocation.

You can be an excellent, thorough and thoughtful designer and participate in contests and crowdsourcing work. You can also do bad design and be professional. What I don’t think you can be is a professional and do crowdsourcing work. When I used the term professional I mean someone who adheres to an ethical and professional code. The discipline starts to erode when the public cannot rely on its practitioners to behave professionally. Professionalism includes operating in the best interests of your clients, which is entirely possible for you to do individually, but which you cannot guarantee for others participating in the contest. The client doesn’t always get the best work, insight, and service available. You don’t have any control over the outcome. Have no illusions about the system, it benefits the owners of the service at the cost of the designers and the clients. The rewards for designers, monetary or otherwise are hard to find in such a system. There are better ways to make a living. Crowdsourcing doesn’t make you a bad designer, but hopefully you aspire to more than being not bad.