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Is the Gig Economy Really Coming to Steal Our Lunch?

Is the Gig Economy Really Coming to Steal Our Lunch?

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By Adi Gaskell
Forbes

2001 seems a very long time ago, but it was then that Dan Pink published Free Agent Nation and predicted a future where we’d all be independent workers.  It was a few years from the publication of that until sharing economy behemoths such as Uber and Lyft emerged alongside gig economy platforms such as UpWork and Etsy, but they have grown at a tremendous pace, with their ascendency causing ripples throughout the world.

Whilst the notion of contingent labor has been around since Manpower was created in 1948, it’s probably fair to say that the Internet has changed the game considerably. When Pink first highlighted the “free agent” concept back in 1997, he suggested there were around 25 million Americans working in such a way.

It should be said that this figure covers all forms of independent worker, and the varied nature of such workers makes measurement notoriously difficult.  For instance, official government data puts the figure at around 15.5 million, which is some way below the 57 million proposed by a recent UpWork survey.

The size of the gig economy

UpWork went on to predict that freelancers would form the majority of the workforce in the United States within a decade, but a recent analysis by the Center for Economic and Policy Research and the Economic Policy Institute pours scorn on such suggestions.  Indeed, they argue that little has really changed since Pink made his prediction all those years ago.

The authors suggest that there has been little real change in work trends in the last 12 years, with those working in the gig economy representing just 1% of the overall workforce.

“Despite the ubiquity of Uber and Lyft drivers in our major cities, the gig economy does not currently hold the key to the future of work,” the authors say.

Indeed, even workers in nonstandard work arrangements has fallen in recent years, from 10.9% in 2005 to 10.1% in 2017. What’s more, the 90% or so of workers operating in traditional work arrangements has stayed largely static since the mid 1990s.

The demographics of gig workers

As with previous analyses undertaken by Prudential, they found that gig work was least common among older workers. For instance, Millennial gig workers were most likely to proactively work in this way as they found the flexibility and freedom of the work most in line with their long-term aspirations.

By contrast, gig workers in Gen-X and Baby Boomer generations were much more likely to enter into gig work because of circumstances outside of their control. This then contributed to a general sense of dissatisfaction with their circumstances among Gen-X gig workers, who were much more likely to prefer to move back into a traditional, full-time job.

So is the gig economy largely hype? Yes and no. Studies such as those prepared by Prudential do reveal that Millennials are much more likely to work in the gig economy than any other age group, and indeed some 1 in 4 Millennials had worked in such a way by 2015. So you could make the argument that this is a new way of working and that as Millennials and Gen-Z grow to dominate the labor market, gig work will become the norm. This is a hypothesis many of that age group support, with the Prudential report revealing that Millennials think it highly likely that freelancers will make up 75% or more of the American workforce.

It’s common for each generation to think themselves to be different than those who went before however, and the lack of real movement in the number of people employed in the gig economy doesn’t suggest that we’re in the midst of tremendous change just yet. That’s not to say such a change won’t happen of course, but as Mark Twain may not have said, reports of the death of traditional work may be ever so slightly exaggerated.

 

This article was written by Adi Gaskell from Forbes and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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