Murat thinks the phenomenon is reminiscent of black jazz players in the ’20s who traveled from “gig to gig” in different cities around the country, living on the edge but doing what they wanted. That observation triggered the thought for me that it has been roughly 80 years since that time, or about four generations, which is the amount of time Neil Howe says it takes for the generational cycle to begin to repeat. I picked up the phone, called Neil, and asked him about this; and he told me there is a great deal of similarity between the Lost Generation of the Roaring ’20s and Gen Xers today. And as it turns out, he wrote a short essay on the phenomenon of the gig economy, which you can read on his site.
The problem with the BLS estimates is that they leave out a sizable chunk of the true gig economy. Quoting Neil:
Consider this: An agency temp, an on-call staffer, and even a standard part-time employee all find themselves in an irregular work environment – and yet many are ignored by the BLS definition.
What, then, would the gig economy look like if we included all contingent workers? By looking at historical CWS data, the GAO found that a whopping 30.6 percent of laborers were contingent in 2005, up slightly from 1999. Further, by analyzing more recent General Social Survey (GSS) data, the GAO determined that this share grew to 40.4 percent as of 2010. (To be sure, some of this growth may be due to differences in the sample populations surveyed.) If anything, this hefty share underestimates the gig economy. Virtually no full-time workers would self-identify as contingent workers, but at least some alternatively employed individuals – such as a full-time Uber driver – consider themselves regular full- time workers.
The basic picture outlined by the GAO report is gaining acceptance. According to economic journalist Justin Fox, “It is fair to say that somewhere between 30 percent and 40 percent of American workers labor in something other than conventional full-time jobs.” Fast Company agrees: “The sector of workers who don’t have traditional full-time jobs – whether by choice or not – is a sizable and growing portion of the workforce.” A more recent survey commissioned in 2014 by the Freelancers Union finds that 53 million Americans, or 34 percent of the workforce, are essentially freelancers.
Moreover, the gig economy is not only large – but also growing. While it’s true that monthly BLS data show a secular decline in self-employment, other categories of gig work have surged. For example, the same data show that the part-time share of the workforce has risen by about 2 percentage points since the Great Recession. Similarly, we can surmise that independent contractors make up an increasing share of the workforce: According to research by the American Action Forum, the country added over 2 million independent contracting jobs between 2010 and 2014, accounting for nearly 30 percent of all jobs added during that time period. After looking at types of work by industry, economist Gerald Friedman estimates that fully 85 percent of net new jobs added since 2005 have been irregular.
A point that Neil made in our conversation is that unlike my generation (Boomers), who are seemingly defined by our work, the Gen Xer says, “Work is not my life; it’s what’s I do to get a life.”
A Bull Market in “Help Wanted” Signs
But outside of the gig economy there is a growing need for skilled workers. My friend Bill Dunkelberg, chief economist of the National Federation of Independent Business, keeps a close eye on small business attitudes and activity. His latest data points to a different problem: employers can’t find enough qualified workers.
The NFIB numbers don’t match what BLS recently reported. According to NFIB, job creation came to a halt in October. Only 12% of businesses they polled reported growing payrolls, while 10% had actually reduced employment. But that isn’t because they don’t want to hire.