Many more people are leaning towards gig jobs than ever before, but since these jobs don’t usually bring employer benefits, their proliferation could make the inequality worse for millions of Americans.
The number of people employed in the U.S. in unconventional ways has risen to a record 51 million this year, jumping an unprecedented 34 percent compared to 2020, according to new data from MBO Partners, a company that provides business solutions to independent workers and conducted a long-term study of the group. These types of workers যার including contract workers, self-employed, temporary and on-call workers, and those who get short-term jobs through online apps or marketplaces এখন now account for about one-third of U.S. employment.
Gig work shifts the risk from employee to employee and can create financial instability for those who do it, resulting in more economic and psychological stress than regular work. Most obviously, independent work does not include many of the protections provided by conventional employment. These include minimum wages, overtime, paid parental leave and employer-subsidized healthcare. If people’s gig work doesn’t independently compensate enough for overtime, it can put people in more severe economic hardship than regular employees.
Independent work, however, has its advantages. It gives employees the flexibility to be able to choose, somewhat, what, when and where they work.
While advocates and some policymakers are actively trying to secure the benefits of full-time employment for independent workers, progress is fragmented and non-linear. The California Landmark Bill AB5 hired many contractors and gave them the same benefits – but soon after it was signed into law, it passed a ballot measure proposal 22, sponsored by gig companies, and allowed many gig companies to consider their employees. The California War is not over; In August, the California Superior Court invalidated Prop 22 and disqualified it, but gig companies say they are going to appeal.
In the meantime, moving towards independent work is still happening.
The growth of business registration for companies without employees (say, an individual selling products on eBay or freelancers looking for graphic design work through upwork) has surpassed wage employment. The average weekly signup in the Freelance Union, a non-profit organization that supports and provides resources for a growing independent workforce, has increased 300 percent since the epidemic began.
Although independent work has increased in all employments, it has grown exponentially for occasional (regular, but non-scheduled hours per week) for independent work performers. That rank has risen 51 percent, to 24 million people. Many of them are doing what is commonly thought of as gig work: on-demand jobs from platforms like Uber It’s or a freelance job site.
The work found through the online marketplace was also important for part-timers and full-timers. About 40 percent of all independent workers reported finding a job using the online marketplace, up from 27 percent in 2020.
The rise of independent work has been happening for decades and for a variety of reasons, from the extinction of traditional theocratic employment to the proliferation of online platforms that connect people to this type of work. Like many trends, it was accelerated by the epidemic – economic instability historically increased independent work – but it shows no signs of going away once the epidemic is over. And so jumping into gig staff in the United States is an issue that we should all pay attention to.
Why are people choosing gig jobs?
Despite rapid economic recovery, there are still 6 million fewer working Americans than there were pre-epidemics, according to the Bureau of Labor Statistics. Many of them have turned to independent work – often missed by BLS data – to compensate.
Other independent workers have regular jobs, but those jobs don’t pay enough. About three-quarters of new part-time independents in the MBO survey said they worked independently to supplement their income.
“The end has become even more difficult,” Steve King, a board member at MBO and future action expert, told Ricode. “In our world, achieving their monthly goals is very challenging for many people.”
Low wages are not the only shortcoming in traditional employment.
“Roughly, what we’ve seen over the last four and a half decades is a huge drop in workers’ leverage, which has led to incredibly low job quality for a large part of our labor market: low wages, low benefits, bad times, poor working conditions,” said Policy Institute Economic Policy think tank Heidi Shearholz, director and former chief economist at the U.S. Department of Labor, told Rekod.
Most independent workers (percent percent) consider working independently to be their own choice. But Shearerholz says that’s not a choice because independent work is especially good.
“We know the value of these [independent] They say the jobs they choose are often incredibly bad, “Shearerholz said.” And that means their other choices are really, really bad. “
Still, in the MBO study, 77 percent of independent workers said they were extremely satisfied with their arrangement, 10 percentage points higher than conventional employers.
Gig work is a way for people to have more control over their actions, more flexibility about when and where they work, and a better work-life balance. Facilities such as the ability to work remotely have become a growing demand during epidemics, making it difficult for people to reconsider the predominance of work in their lives in general. This type of work is especially difficult for people in charge of child care or adult care, or for people with disabilities where regular employment is difficult.
“I think a big thing is that the work of the online platform is really enabling people who are looking for more flexibility,” Adam Ozimek, chief economist at Freelancing Platform Upwork, told Rekod. “A lot of people got a taste of working from a distance this year and they see the flexibility that comes with it and they want more.”
According to the MBO, a growing proportion (2 percent) of traditional employees consider even independent work to be less risky than them. Two-thirds of independent workers think so.
Independent work is also sometimes easier to get. The emergence of apps or platforms like Taskerbit and Fiber has made the process of finding independent work much less difficult by making it centralized and easier.
Then there is the problem of incorrect classification for the growth of independent class workers. Distant industries such as construction and ride-healing call their workers contractors instead of workers. The difference, sometimes legally dubious, is economically advantageous. The Institute for Economic Policy estimates that employers can save about 25 percent on employees rather than contract workers. Savings come from employers who are unable to pay things like unemployment insurance, workers’ compensation, and paid leave.
How do you protect the growing status of independent workers?
Lack of protection like unemployment insurance or employer-subsidized health care means that incidents like accidents, a new baby or a global epidemic can negatively affect independent workers more than conventional ones.
“There is no social security net for freelancers to rely on them to work for weeks or months,” Rafael Espinal, executive director of the Freelancers Union, told Recode.
Union is one of the many advocates working to create something called Portable Benefit so that independent workers get things like paid leave, unemployment insurance, retirement plans and affordable healthcare regardless of their job status.
So far, less than 10 states have guaranteed paid job leave for new parents to include gig workers. Biden’s proposed American Family Plan would create a “national comprehensive” paid family vacation plan that the Freelancers Union hopes will include freelancers. The proposal is still fighting in Congress, so even if it passes, what it will eventually include is in the air. Independent workers are not included in the Family and Medical Leave Act, which provides job protection to workers during unpaid leave.
“When the budget is passed, we need to make sure that independent workers are included in the implementation of the program,” Espinal said. “It should not be a difficult lift that few states were able to successfully implement similar programs.”
And in the case of benefits, paid leave is only a part of the iceberg. It is not enough to address all the needs of the rapidly growing number of freelance and independent workers representing a significant portion of the American workforce.
Espinal believes that the responsibility for the protection of independent workers rests with the government.
“If it becomes unstable, because the federal government has failed to respond,” Espinal said. “I believe the silver lining of this epidemic is that it pushes federal and state governments to the point where they have to respond and notice how they build safety nets for the millions of people who have traditionally been left alone.”