Alternative Work is Growing, but the ‘Gig Economy’ Is Just a Part of It

Anna Louie Sussman and Josh Zumbrun at the Wall Street Journal preview some forthcoming research from economists Alan Krueger and Lawrence Katz indicating that alternative work arrangements now account for roughly 16 percent of the American workforce—compared to 10 percent a decade ago—but the “gig economy” makes up a small fraction of that. Krueger and Katz found that only 600,000 people, making up less than 0.5 percent of the workforce, are working “on-demand” through platforms like Uber, a finding consistent with a figure Krueger and Seth Harris gave in a paper published last December:

Worries about the gig economy have “distracted us from this larger change that’s had more fundamental and pervasive effects,” said David Weil, administrator of the Labor Department’s Wage and Hour Division, which enforces employment standards.

The Labor Department breaks down the four main types of alternative work arrangements into independent contractors, on-call workers, temp workers and workers employed by contract firms, but it hasn’t updated its count of such workers since 2005. Messrs. Krueger and Katz hired Rand Corp. to replicate the survey, sampling roughly 4,000 people. The findings show how alternative work has spread across industries and occupations—including those not associated with the gig economy.

For example, they estimate the share of workers in alternative arrangements has more than doubled to 11% in manufacturing and to 16% in health and education. It has quintupled, to 10%, in public administration.

Alison Griswold at Quartz highlights another interesting point from Krueger and Katz’s latest work, namely that the “gig economy” seems to mostly consist of Uber:

Uber alone could be responsible for half to two-thirds of all gig economy work … In a preview of their core findings, the two describe Uber as the “quintessential employer of gig work.” They also cite Google Trends data showing that searches for “Uber” are double those for all other gig companies combined (i.e., Lyft, TaskRabbit, Handy, Instacart).