COMMENTARY: Is the ‘gig economy’ a myth?


The “gig economy,” RIP. Well, maybe.

As you’ll recall, the gig economy refers to a radical transformation of the nature of work and U.S. labor markets. Digital platforms better match workers with jobs (aka, gigs). Uber was, and is, the prototype of this upheaval.

Its existence seemed confirmed. One survey by well-regarded labor economists Lawrence Katz of Harvard and Alan Krueger of Princeton estimated that the share of U.S. workers in various “alternative work arrangements” rose from 10.7 percent of total employment in 2005 to 15.8 percent in 2015. That’s a big deal.

Opinion has been divided. Supporters found many virtues. Workers would work when they wanted. Companies could better calibrate their work forces to their needs. Productivity would improve. Critics were unpersuaded. A bigger gig economy, they argued, would reduce job security and fringe benefits (health insurance, retirement accounts).

But suddenly, the debate has imploded; the gig economy may be a myth. A new survey by the Bureau of Labor Statistics found that, in 2017, the share of workers in “alternative employment arrangements” (gig jobs and other) was 10.1 percent of total employment, almost exactly what it was in 2005 (10.7 percent) and 1995 (9.9 percent). Whatever Uber and other digital platforms are doing, they haven’t altered long-term trends.

The 1995 survey, the first of its kind by the BLS, defined “traditional” job as permanent employment on a firm’s payroll. “Alternative” jobs fell into four groups: (1) on-call workers — for example, seasonal workers; (2) independent contractors — freelancers, self-employed consultants; (3) temps — people paid by a temp agency but who physically work at another company; and (4) contract firms that provide services to other firms (examples: security guards or cafeteria workers).

Look at the table below. It shows that, as a share of total employment, these types of jobs have remained remarkably stable. Independent contractors are the largest single group, representing 6.9 percent of total employment in 2017 compared with 7.4 percent in 2005 and 6.7 percent in 1995.