For the first time in thirteen years, the Bureau of Labor Statistics released a contingent workforce supplement last week that attempted to quantify the number of people engaged in “contingent and alternative work arrangements,” including freelancers and the self-employed.
You may have seen headlines in the past week about how the “gig economy” has actually shrunk in recent years, but unfortunately this doesn’t capture the full story.
While the BLS study was an important step, the report had several important limitations:
- It only looked at primary sources of income - Many workers have a regular W2 employer but freelance on the side, whether that’s driving an Uber on the weekends, doing graphic design work, or moonlighting as a writer. The BLS supplement doesn’t capture these “side hustles.”
- It misses many freelancers who work as subcontractors - As many freelancers know, even when you’re working as an independent contractor for a company, you’re often set up as an “employee” of a payroll service or staffing agency. The government does not define these arrangements as “alternative” workers.
- It only asked people how they worked in the past week - Freelancers Union’s Freelancing in America study with Upwork counts people who have freelanced in the past year for a reason -- much of the freelance economy is seasonal and irregular.
It’s good that the US Government and BLS is investing in better understanding this workforce, and they’ve pledged to release data in coming months on the use of online platforms to find work, but their study is only a limited glimpse into the freelance movement.
We need better data to understand the freelance workforce and its challenges. In particular, the government needs a truer sense of the freelancing population to not only drive new policy, but to understand the implications current policy has on this growing and diverse workforce.
In our Freelancing in America study, we found that 57.3 million Americans are freelancing, contributing $1.4 trillion to the economy annually. In the past four years, we have consistently seen this number grow. Our study constitutes a broad look at all the diverse ways freelancers are piecing together their income, from contracting to temp work to running a business.
For example, moonlighters (23%) and diversified workers (35%) are key segments and together comprise over half of the freelance workforce -- these were left out of the BLS study.
Freelancers have made it clear that they don’t feel well-understood by policymakers and are looking for politicians that can speak to them -- 72% indicated they would cross party lines to support a candidate that supported freelancer interests.
Building a better future for freelancers starts with learning as much as we can who freelancers are and what challenges they face. The BLS report was a good step, but the government needs to do more to gain an accurate and ongoing understanding of the independent workforce.
For further reading:
The BLS report:
Summaries of the report:
- Maybe the Gig Economy Isn’t Reshaping Work After All (New York Times)
- America’s gig economy is smaller now than before Uber existed, official data show (Washington Post)
Responses to the report:
- The government’s brand-new gig economy data is already outdated (Fast Company)
- Five Takeaways from the 2017 Contingent Worker Supplement (Gig Economy Data Hub)
- The Triumph of the Gig Economy Is Postponed Yet Again (Bloomberg)