Gig Economy

For True Story On The Gig Economy, Details, Along With Data, Matter

Dueling headlines show that when it comes to the gig economy, differing data tell different stories.

Citing findings from the Bureau of Labor Statistics (BLS), The Washington Post noted that the share of U.S. workers in the gig economy has fallen to 6.9 percent of workers at the end of last year from 7.4 percent in 2005.

Based largely on that headline, the assumption is that firms in the gig economy, namely marquee names such as Uber and Lyft, have not rendered the sea change that had been expected by many observers, one where the gig economy has transformed, and will transform, the very way we work.

The Post noted that the gig economy has had an enthusiastic embrace, of sorts, where money is concerned, as venture capitalists have poured billions of dollars into its coffers.

And yet, wrote the paper, the Bureau’s “findings suggest that while the nature of work may be changing in certain fields like transportation, there is no dramatic shift away from traditional employment in the economy.”

In commentary on the report, Heidi Shierholz, who served as a former chief economist at the Labor Department, said the numbers show that “the vast majority of workers in the United States still have traditional jobs as their main source of income. We should be spending most of our time thinking about boosting wages in traditional jobs so people don’t need a side hustle.”

And yet: Look a bit closer, or look elsewhere, and the story changes. Turns out the gig economy is not a portrait to be painted in broad strokes but is to be pieced together like a mosaic. The Post gave a nod to this on Thursday, stating that, per experts, tracking the gig economy is a “uniquely difficult task” because the BLS numbers do not track subcontracting and “the side hustle.” The BLS simply asked people about primary jobs, which means that someone who supplements their income via project-based work does not count.

Again, these are headline numbers. Drill down a bit and the BLS shows a few other trends on the rise. Taken on a per industry basis, independent contracting has gained traction in verticals such as transportation. In that sector, the number of independent contractors has jumped 50 percent, tied, of course, to Uber and peers. Elsewhere, freelance business services have seen a jump amid baby boomers as they embrace retirement and work as consultants.

The tally of independent contractors stands at 10.6 million workers, per the BLS, and a third of them are over 55.

In another study that points to the size and scope of the gig economy, economists at Harvard and Princeton have said that “alternative work” employees, spanning independent contractors and temporary staffers, stood at 15.8 percent at the end of 2015, which is higher than a similar measure estimated at 10.7 percent found by the BLS at 2005’s end.

That data gets a bit closer at the truth, it seems, but may not quite be there yet.

Look again, and look elsewhere, and the story changes yet again.

Just last month, the Gig Economy Index produced in conjunction between PYMNTS and Hyperwallet showed a bit more granular picture, one that captures gigging across the spectrum. Turns out that just measuring the stats tied to folks who derive their full income from gigging is an incomplete measurement at best.

The Gig Economy Index shows that roughly 40 percent of the U.S. workforce makes 40 percent of its income through gig work. So, a sizable slice of the population gets a sizable slice of its top line from contracting out services of some sort. Some 55 percent of gig workers also have a full-time job. And no less than 75 percent of those workers would not switch back to a full-time job, as the perks are changing, marked, in part, by flexibility and a wider availability of benefits.

Sea change? Seems like it, if you take the time to view it up close, rather than from some distant shore.

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