Diversity in the Gig Economy?

Patrick Llewellyn of 99designs writes at Entrepreneur about “How the Gig Economy Helps Boost Diversity” [1].  In particular, he is referring to online platforms which, he says, “create a truly level playing field irrespective of location, gender, age or background”.

He touts the many benefits to businesses (thinking mainly of web design businesses like his own 99designs), which can find (low cost) talent from all over the globe.  He’s particularly excited by the availability of talent from every geographic location. Online platforms certainly make it way easier to hire contractors far away from your home office.

Llewellyn seems to believe that this is good for workers.  In general, online gigging is “a unique space where the world’s best talent can connect both with each other to exchange ideas and share feedback,” he says.  He views gig workers as “Valuing flexibility over more traditional benefits”, which is a “valid choice.”

Finally, the level playing field is especially important for workers who live far from the centers of commerce and media.  (This, I suppose, is another “valid choice”.)

“No skilled worker should be disadvantaged because of where they were born or where they live.”

This best of all possible worlds bears little resemblance to the actual gig economy.

First of all, much if not most of the “gig economy” is not high skilled labor, but trivial piecework for pennies.  And much, if not most, is not online work, even if the labor market is digitized.  Llewellyn is thinking about and talking about a tiny, unrepresentative fraction of the overall gig economy.

Second, he’s rather hazy on what “diversity” means.  He’s primarily thinking of geographical location, which seems to stand in for cultural diversity.  But there are lots of other kinds of diversity to think about, especially gender racial, and ethnic backgrounds—and age. The online contracting workforce is certainly international, but it’s not clear that it is much different in any other way. And there certainly is no evidences that it operates as a level playing field.

Third, he offers not one shred of evidence that such geographic diversity is actually beneficial even to the business.  I’m assuming that he’s thinking of digital collaborations (in English).  Working across time zones with people who never meet in person can be challenging.  I believe it can work well, at least in some cases. But that doesn’t mean its good for all jobs, and there is good reason to think twice about this kind of outsourcing.

Finally, I’ll note that the article is entirely from the point of view of the business. (This is fair, as it appears in Entrepreneur.)  Hiring gig workers via an online platform is basically outsourcing to temp workers from overseas. This may be good for the business, and maybe even for some workers, but is hardly a great thing for most workers.

Let’s put the best spin on Llewellyn’s point:  he’s encouraging employers and freelancers to embrace the opportunity to work with “people who aren’t necessarily like you.”  That’s a good idea, but you scarcely need to outsource through digital share cropping to accomplish that goal.  There are plenty of people “not necessarily like you” right where you live.

  1. Patrick Llewellyn, How the Gig Economy Helps Boost Diversity, in Entrepreneur. 2018. https://www.entrepreneur.com/article/323253


Freelancing in America Report 2018

The annual “Freelancing in America” report was released October 31 [2].

In past years, I have criticized this report for some sloppy and perhaps misleading claims.  Let’s have a look at this edition.

First of all, the report is base on “An online survey of 6,001 U.S. adults who have done paid work in the past 12 months” [1].  This is an impressive sample, and includes “non Freelancers”.  It’s always hard to be sure of biases in online surveys—obviously not everyone can be reached this way or will participate.  In this case, there will surely be a skew toward including younger, digitally active workers, for instance.  But still, this is a pretty big sample, so that’s good.

One of the headline numbers is that the total number of “freelance” workers held steady compared to 2017, at about 50 million.  This was reported as “3.7 million more”, but that number is growth since the first report in 2014.  There was actually a slight decrease in the number of Freelancers between 2017 and 2018.

In fact, throughout the report, there is very little change from 2017.  But to create an illusion of growth, the base of comparison was shifted to the 2014 survey.  Sigh.

As noted in earlier discussions, this report consistently uses a very expansive and debatable definition of “freelancing”.  They include pretty much anyone who did any part time work at all, from the smallest hobby up to full time a independent business. If you focus on “close to full time” freelancers, there are about half as many as the headline number.  This means that roughly 10% of the US workforce is (more or mostly less) earning a living  freelancing.  That’s quite a few, but less exciting than some of the headlines imply and not necessarily a big change from 50 years ago.

I understand why the Freelancers Union wants to spread the net widely, I’m a ‘one big union’ guy myself.  But these workers really are such a diverse lot it’s questionable whether they should be talked about as if they are one group.

Another headline number is that 61% of freelancers do so by choice, as opposed to necessity.   This percentage has risen over the last few years, suggesting that freelancing really is preferred by many workers, and that number may be growing.  This growth may also reflect better employment opportunities, which has the side effect of reducing the number of involuntary freelancers (because they have found conventional employment).

The survey found that the more freelancers reported full time employment (defined as 35 hours per week or more, I think), and reported incomes of freelancers held steady over the year.  Every survey has shown that the majority of freelancers work less than full time, and, hardly surprisingly, earn less than $75K.  (As I have said before, statistics about freelance “income” need to be taken carefully, because independent contractors have to cover overhead and benefits, so income can’t be simply be compared with wages.)

The survey also reports on the completely unshocking fact that Freelances find that upgrading skills is a good idea, though training is awfully expensive when you are paying your own way.

The survey finds that, as always, autonomy is one of the named benefits of Freelancing, including the ability to make time for family.  And, as always, Freelancing has its own challenges, including unpredictable work and income, and isolation.  Freelancers also face the same anxieties as all workers about health insurance, retirement savings, and low pay. But I guess even though work still sucks, but at least you are working for yourself in your own interest and on your own terms.

A large number of Freelancers report that they make more money Freelancing than in previous conventional employment.  This is an interesting finding, though I still wonder how earnings are being counted.  For instance, is this a higher hourly rate, or a difference in the hours worked?  And perhaps the causation runs the other way—underpaid workers are more likely to jump to Freelancing because of low pay, not because Freelancing pays well.

This study replicates the frequently reports that most Freelancers would not take a conventional job if offered.  This is a solid sign that Freelancers are satisfied, and suggests that pay and conditions must be at least competitive.  I have to point out that this also shows just how sucky US employers seem to treat workers.  I mean, with all the stress and overhead of freelancing, it shouldn’t be that hard to be a nicer alternative.  You know, treat people with respect, pay decently, take care of important needs.  Stuff like that.

Overall, when you look at the actual data the picture is sobering.  The number of Freelancers has held steady, which may reflect a better overall job market for all kinds of employment.  Freelancers still face uncertainty, and many work only a few hours for very little pay.

Indeed, there may be a trend emerging where Freelancing is diverging into a top tier of high paid independent workers (e.g., in-demand technical workers), and a lower tier of low paid contingent workers (e.g., the lumpen proletariat of content generators). This pattern has certainly existed for a long time int he temp economy, so it may not be a surprise if the gig economy simply replicates the gig sector of the old economy.

If this truly is a trend, then it will be very important not to lump all freelance and independent workers into one conceptual heap.  Highly skilled independent contractors with high incomes have different needs and opportunities from low skill, contingent workers.  Above all, it is a mistake to blithely claim that freelancing is a viable path to a decent living for all workers—it isn’t, any more that conventional employment is.

The Freelancers Union has a key role to play here, especially in helping less secure and lower paid workers build a decent life.  Solidarity of all independent workers is a good thing, and to date the FU has done a decent job of fighting for everyone.  (#FreelanceIsn’tFree, insurance, etc.)

However, I would like to see future reports take a closer look at the differences among Freelancers who are full time, part time, and in different pay tiers.  There are many common concerns, for sure.  But there may be some important issues lost in the aggregate.  (Just as a for example, part time working mothers will have important challenges finding affordable child care, not to mention enough hours in the day.)

Disclosure:  I am a long time member of the Freelancers Union.

  1. Freelancers Union and UpWork, Freelancing in America: 2018: An independent, annual study commissioned by Freelancers Union & Upwork Freelancers Union, 2018. https://www.slideshare.net/upwork/freelancing-in-america-2018-120288770/1
  2. Caitlin Pearce, Freelancing in America 2018, in Freelancers Union Blog. 2018. https://blog.freelancersunion.org/2018/10/31/freelancing-in-america-2018/