PPB January 2018

TYPES OF Independent Workers 72 % Percentage of independent workers who participate in the sharing economy by choice 46 % Percentage of independent workers for whom gig work provides their primary income 51 % Percentage of women working in the sharing economy A McKinsey Global Institute study released in October 2016, Independent Work: Choice, Necessity And The Gig Economy, found this market employs nearly 68 million people in the U.S. and approximately 92 million across the European Union. Of the 8,000 workers surveyed, 44 percent work in the gig economy as a primary source of employment, while 56 percent use this market to supplement their primary income from traditional jobs. The defining features of sharing economy employment (independent workers) are a high level of control and autonomy; payment by task, assignment or sales volume and a short-term duration/relationship with clients. High-profile gig economy players include Airbnb, Uber and Lyft. But other up-and-comers such as taskrabbit, a service platform that allows users to hire workers for everyday tasks, and NeighborGoods, which allows individuals to “share” their household goods and tools with one another, branch out with their offerings of goods and services. The gig economy’s roots are firmly planted in the entrepreneurship that dominated the early 20th century, but the primary difference between independent business operators and gig workers, according to the McKinsey study, is that the latter primarily focus on short-term commitments to several clients, rather than building long-term relationships with individual ones. And while workers in the sharing economy benefit fromflexibility and variety, the flip side is the likelihood of inconsistency, along with the challenge of obtaining and affording insurance coverage. When a book of business is built primarily with one-time transactions, self promotion can be the best means of securing a steady stream of clients— and income. Gig workers benefit from self promotions that zero in on target audiences and tell prospects that their satisfaction is the service provider’s top priority. Market Snapshot Who Are Gig Workers? Many gig workers fit the U.S. Census Bureau’s definition of a nonemployer, according to the Bureau of Labor Statistics. In most cases, a nonemployer is defined as a self-employed individual operating a very small, unincorporated business with no paid employees. Independent workers who sell goods or services, or rent personal assets, are more likely to use digital platforms than workers who provide labor services for a fee. Free Agents Workers who earn their income primarily through gig work, and do so by choice Casual Earners Workers who supplement their income with gig work, by choice Financially Strapped Workers who earn supplemental income through gig work to make ends meet Reluctants Workers who earn their primary income through gig work, by necessity 68 MILLION Number of independent workers in the U.S. (2016) | JANUARY 2018 | 47 GROW