Gig Work Is Becoming Increasingly Popular, And It's Not All Uber Drivers
When you think of gig workers, you most likely think of people doing work such as driving for Uber or walking dogs for Wag. While these types of gig workers are becoming increasingly common, so is the use of gig workers at regular businesses.
According to a report by ADP Research Institute, the share of gig workers at U.S. companies increased notably over the last decade. From 2010 to 2019, the share of gig workers at U.S. companies increased from 14.2% to 16.4%, a jump of 15%. Despite the report finding one in six employees is a gig worker, at 40% of the companies surveyed, the number is even higher with one in four employees being a gig worker.
ADP analyzed payroll data from more than 75,000 companies representing more than 18 million employees. They defined a gig worker as contractor who has received Form 1099-MISC from their hiring organizations or short-term W-2 employees working one to six months. The two groups of gig workers had about an equal effect on the overall growth of gig workers over the last decade.
Recreation, construction, business services and finance are the industries with the highest share of gig workers. Conversely, manufacturing, wholesale trade/utilities, mining and healthcare are the industries with the lowest share of gig workers. Interestingly, in almost all of these industries, 1099-MISC employees earn more than traditional W-2 employees.
Florida is the most popular state for gig workers, with 22% of its workforce consisting of gig workers. California counts 20% of its workforce as gig workers, while Texas and Illinois, with 18%, round out the top four.
20% of all gig workers and 30% of 1099-MISC employees are over the age of 55. Interestingly, nearly 40% of those gig workers over 55 consider themselves retired despite actually working in gig positions. Conversely, many have lost previous jobs or retired and this is the only type of work they can get. Only about one-third of gig workers over the age of 55 believe they can find a traditional W-2 job as good as their current gig work.
"For someone in that age group who has been downsized from a job or taken early retirement, it’s really hard to get a full-time job," said Kerry Hannon, author of Great Jobs for Everyone 50+.
With ADP's report not including many of the more common gig workers that have become so prevalent through countless tech startups, the true percentage of the workforce that is depending on gig work is likely much higher than 16%.
Despite the pay for many of these positions being greater than that of traditional W-2 employees, gig workers typically do not receive benefits such as health insurance, 401(k) plans and paid vacation. With this type of employment continuing to make up a larger share of the workforce, the lack of health insurance and retirement savings for these employees could end up being a burden on society in the long run.
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