The BLS Just Released Its First Research on the Freelance Economy in 13 YearsBy Colton Cox June 8th, 2018
Yesterday, the U.S. Bureau of Labor Statistics released a new report analyzing developments in the freelance workforce. Researchers on “Contingent and Alternative Employment Arrangements — May 2017” began collecting data in February 2005, and their results now suggest that the size of the gig economy, or “contingent workforce,” has shrunk over the last 13 years. Freelancers now represent 1.3 to 3.8 percent of all U.S. workers.
The data on contingent work, freelance work, and temporary gigs was collected through a supplement to a monthly sample survey, the Current Population Survey, which was distributed to 60,000 eligible households. The survey was focused on workers who “do not have an implicit or explicit contract for ongoing employment,” and researchers drew their conclusions from three estimates which offer slightly different interpretations of “contingent work.” Survey questions referred specifically to the worker’s “main job”—meaning the job in which they worked the most hours. By nature, this may exclude workers who moonlight as freelancers.
As Upwork CEO Stephane Kasriel pointed out on Fast Company, the survey is modeled around a one-week snapshot of work activity, which may not accurately reflect the working schedules of freelancers today, who often have gaps between projects.
Previous independent reports had estimated freelancers to encompass about a third of the U.S. workforce. A 2016 report by the McKinsey Global Institute, “Independent work: Choice, necessity, and the gig economy,” found that 20-30 percent of the combined workforce of the United States and Europe have engaged in independent work over the past 12 months.
Upwork and Freelancers Union found similar results in their report, “Freelancing in America: 2017,” built from data acquired through surveys of 6,000 working adults by Edelman Intelligence. They estimated that 36 percent of the American workforce is freelancing, with the number to pass 50 percent by 2027.
The contrast between the BLS report and other recent research underlines the notion that employment, as a steady and full-time practice, may be different for freelancers than it is for salaried workers. In the gig economy, opportunities can ebb and flow, which may require freelancers to hold down part-time jobs while the bulk of their income comes from contingent work, or “side gigs.”
Freelancers can expect these surveys to be completed more frequently in the future. Upcoming surveys will likely analyze work activity over a longer period and take into consideration that the “primary job” concept isn’t all that relevant to full-time freelancers.
A more nuanced understanding of freelancers’ contributions to the total U.S. workforce could move the needle for new legislation to address specific concerns raised by a “gig economy”—including the need for freelancer benefits, medical insurance, and tax deductions.Image by iStock