What is the gig economy?

Published on October 3rd 2019

What is the gig economy?

A broad definition of the gig economy might include all freelance and contract workers — anyone taking a job for a finite amount of time. However, recent usage of the term “gig economy” has tended to focus on workers who find work through — and are paid by — technology platforms. The Bureau of Labor Statistics (BLS) calls this “electronically mediated work” and recently published the first government study of this group of workers, providing new insight into the gig economy.

How many gig economy workers are there in the United States?

According to the Bureau of Labor Statistics, there are 1.6 million gig economy workers in the US, defined as workers paid through tech platforms like Uber or TaskRabbit. These workers account for 1% of the US workforce.

In 2015, the Government Accountability Office estimated that people in non-traditional work arrangements could account for as much as 1/3 of the workforce.

What kind of work do gig workers perform?

Seventy-two percent of the 1.6 million people working gig jobs work full time, meaning more than 35 hours per week. Not all gig workers are self-employed. In fact, 63% report being an employee, rather than being self-employed. Eighty percent of self-employed gig workers don’t have a formal business entity set up.

Sixty-two percent of these workers perform their work in-person versus 38% online. In-person gig work platforms include ridesharing companies like Uber and Lyft and delivery companies like Dolly and Postmates. Online platforms include Clickworker, which tasks workers with data management and web research, and Fiverr, a platform for creative work.

Who is the typical gig worker?

Workers aged 25 to 54 are 64% of the nation’s overall workforce, but they’re an even bigger share of gig economy workers (71%). Gig economy workers are less likely than the average worker to be under 25 or older than 55; however, there are likely demographic variations depending on the industry and nature of the work.

Slightly more men are employed by the gig economy - 54% of gig workers are men compared to 46% who are women. Gig workers are less likely to be white than the rest of the working population, but white people still account for 75% of all gig workers, followed by black workers at 17% and Hispanic workers at 16%. White and Asian gig workers are more likely to perform work online, whereas black and Hispanic gig workers are more likely to work in-person gigs.

Half of gig economy workers over the age of 25 have a bachelor’s degree or higher, compared to 35% of the general population.

Demographic category:
By race
By age
By gender
By Education
WhiteBlackAsianHispanic/Latino
% of all workers78.712.15.916.6
% of all gig workers74.617.15.816.4

More data is needed

The electronically mediated work questions added to the BLS Contingent Worker Survey in 2017 represent some of the first survey data on app-based gig workers. However, more information is needed to answer pressing questions, such as why people work in the gig economy, what industries they work in, and how much people earn in these jobs compared to jobs in similar industries.

The BLS survey was conducted in May 2017 and asked survey respondents whether they’ve earned any money through gig platforms in the last week. This means we only have a one-week snapshot of the gig economy. Some people take gig jobs infrequently or seasonally; the total number of gig economy workers during a year is likely higher.

In addition, more detailed information on the types of jobs and employment status of gig economy workers should be collected. A 2019 Treasury report estimates that $69 billion in taxes goes uncollected from gig work, which would be an additional 4% in individual income tax revenue for the federal government.

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