For Most, Working In The Gig Economy Is Not A Stopgap Measure

We’ve been looking into the U.S. Gig Economy across various facets, based on our recent research into the trend. In our previous column we looked at numbers that suggested about a third of the U.S. workforce is engaged in gig work. Our own exploration of this group, people making more than 60 percent of their income through gig work, suggests that the vast majority are choosing to engage in this mode of earning for the foreseeable future. As such, the gig economy seems poised to grow. In this column, we’ll address its far-flung demographics and the broad range of fields represented by U.S. gig workers. Then we’ll answer one of America’s favorite questions: How much do they make?

The second report in our gig economy series, The Gig Economy Represents a Vast Range of Industries and Fields, looked at breakdowns by gender, geography, education, and whether workers are single or in a relationship. We asked about their level and frequency of pay, and about their tenure in working independently. The range of work fields we identified in the research confirmed the multifaceted skills and occupations practiced by this group. We also gained a better understanding of their personality traits and what drives them to work independently.

One of the challenges of designing a study on the Gig Economy is coming to a solid definition of “gig work.” The diverse set of professions and income ranges that can be called gig work makes it difficult to generalize, but it’s worth noting the sectors we looked at. Here’s a recap:

· Sole Professional Services/ Consulting

· Creative/ Design /Arts/ Music/ Video

· Agriculture/ Seasonal/ Construction

· IT, Web design, etc.

· Beauty & Health

· Media/ Writing/ Digital marketing

· Driving/ Transportation/ Delivery

· Family business operator

· Real Estate

· Retail

· Online/ App based services

· Education

· Healthcare

· Personal Services

· Sales

· Insurance

· Pet Care

· Public / Social service

Which begs the question, given the size and range of the group, do these workers have access to the sort of safety nets available to employees? There has been public and political controversy surrounding gig work that seeks to answer the same question, an argument that centers on financial factors. Again, how much do they make? It is a fair, inclusive wage? And how are they being paid? The U.K. government commissioned a study on this back in 2017, Employment Practices in the Modern Economy, looking at ways employee protections could keep pace with work changes brought about by the digital economy. Recently the U.S. Labor Secretary proposed to re-classify gig workers—a policy centering on codifying drivers as employees, not contractors. It’s interesting to note that the same day this announcement was made, the stock values of Uber and Lyft plunged 8 and 12 percent, respectively.

But driving and delivery services, it turns out, are only a tiny fraction of this story—6 percent, in our sample of 1,044 survey subjects. One of the fascinating takeaways from this this research was the kaleidoscopic array of people, professions, and pay scales that exist in the U.S. Gig Economy. The entrepreneurial spirit of U.S. gig workers seems to lead to an adaptive, polymath mindset that flies in the face of the model of financial and social stability offered by traditional employment models.

That said, our research found that gig workers’ incomes ranged widely, from 49 percent earning under $50,000 a year, to 28 percent earning between $50,000 and $99,000, to 23 percent earning between $100,000 and $4 million a year from gig work. The longer they had been working independently, the higher their earnings tended to be. And it should be noted that the $4 million per annum worker was a statistical outlier.

In our study population, 53 percent of respondents were male and 47 percent were female. There were significant differences between the earning potential of female and male gig workers: 64 percent of top earning gig workers are male, while 56 percent of the lowest bracket earners—less than $50,000 a year—are female. We saw a similar disproportion among gig workers who are parents: only 34 percent of top earning parents are female compared to 66 percent of males.

A diverse picture emerges from the research data. One-third of the gig workers we interviewed were single while two-thirds were in a relationship. They hailed from every region of the country, but there was a slight skew (34 percent) toward the southern states. They also tended to be very well educated—61 percent had attained either a graduate (25 percent) and/or undergraduate (75 percent) degree. And among the list of 18 possible work sectors we provided, at least 1% of them identified with all of them. As noted above, these ran the gamut from professional to tech to creative to agricultural to web-based to education, retail, healthcare, delivery, pet care… and many others.

While critics of gig work see the practice as a stopgap measure, not fruitful or stable enough to be a sole source of income over the long term, our study goes some way toward dispelling this myth. As one respondent put it: “It affords me the income to live decently.” Fully 60 percent of the people we talked to earn 100 percent of their living from gig work, while an additional 33 percent earn at least 70 percent of their total income working independently. These figures point to a need for understanding how best to serve this growing segment of the population.

Next time we’ll look at some of the reasons why gig work is becoming a choice for so many Americans.