The Rise of the Gig Economy and the Challenges for U.S. Workers



One of the biggest changes in our labor market
over the last ten years or so has been the rise of what we might call
alternative work arrangements. Roughly eight percent of the workforce
worked as contract workers, working on-call, working in
the gig economy back in 2005. Ten years later, that percentage has doubled. That’s an exciting development,
and it offers much flexibility for workers. It offers new opportunities for
different types of jobs for workers who want to supplement or who just want more flexibility in their day. But it also provides some challenges, because one aspect of our labor market,
and our labor market institutions is that much of the support for work, the non-wage benefits that come with work, such as health insurance, retirement
insurance, paid sick leave, even getting lifetime education, learning on the job
or having access to educational benefits, have been tied to employment,
and typically tied to full-time employment. So the workers who are
actually working as contractors, or working part-time or working in this gig economy, typically don’t have access
to those types of benefits, which means that they don’t have health insurance. They’re not saving for retirement. If they are sick, they don’t have paid sick leave. It’s those wrap-around benefits that have
traditionally gone with work in the U.S. that are missing, and that we
very much need to confront because these types of work arrangements are not going away.

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