Updated on
Reviewed by Steve Rogers
The gig economy is changing the way people work. From ride-sharing companies like Uber and Lyft to delivery specialists like Instacart and DoorDash to Airbnb, Upwork, Fiverr, and many more, millions of people worldwide are turning to online platforms to supplement their income and even build new careers.
But what is the current state of the gig economy in the US?
This gig economy statistics roundup should give you a better idea of how many gig workers there are, how much they’re making, who they are, and what type of activities they are working on.
Key Findings
- 16.4% of the American workforce is made up of gig workers.
- 30% of younger US adults (ages 18-29) have made money through gig work at some point.
- There are 9.94 million self-employed people in the US as of January 2023.
- Almost half (47%) of gig workers in the US have full-time jobs.
- 1099-MISC contractors in the US made on average $6,810 per month (vs. $6,340 among W-2 employees).
- Flexibility and supplemental income are one of the most common reasons for taking up gig work.
- 24% of gig workers lack health insurance, and 29% earn less than their state’s minimum wage. Workers often lack important benefits and protections.
What Percent of US Workers Participate in the Gig Economy?
8.5% of the American civilian workforce is made up of gig workers, accounting for 14 million American adults (out of a total of 165 million Americans in the civilian workforce)[2].
16% of American adults have reported having earned money on online gig platforms at some point. 9% of adults have reported gig platform-related income in the past 12 months (survey conducted in August 2021)[1].
How Many Americans Are Self-Employed?
Based on the latest count in January 2023, 9.94 million people in the US are reported by the Bureau of Labor Statistics to be self-employed. That’s an increase of 397 thousand self-employed people since 2019[5].
Self-Employed People in the US
Note: * In Thousands of Persons
** Incomplete data for 2023, only includes January 2023.
Gig Work Demographics
Gig Workers by Age
Experience taking up gig work is most common with younger adults, with 30% of respondents ages 18-29 years old in the US claiming to make money this way at some point, followed by an 18% participation rate in the age group of 30 to 49 years old. Less than 1 in 10 (7%) adults older than 65 reported participating in the gig economy at some point[1].
Gig Work Participation in the US by Age
Gig Work Participation in the US by Income Level
Gig Workers by Income
Gig work is more popular among lower-income earners than it is among middle-income earners or upper-income earners. While 25% of lower-income earners (with a family income of less than $42K) have participated in the gig economy, only 13% of middle-income earners ($42K-$125.9K) did so, and 9% of upper-income earners (over $125.9K) made money through online gig platforms[1].
Gig Workers by Gender
In the 2021 State of Gig Work report from Pew Research, 17% of female American adults reported having earned money from gig platform work at some point, while 15% of male US adults said they had earned money this way[1].
Gig Work Participation in the US by Race
Gig Workers by Race
Hispanic adults in the US lead the way in gig work participation, with 30% reporting earnings from gig platform work, followed by 20% of Black adults, 19% of Asian adults, and 12% of White adults in the country[1].
Gig Work by Industry
The recreation and construction industries in the US are leading the way with the highest share of gig workers, 38% and 33%, respectively, followed by business services, where one-third are employed as gig workers, not as traditional W-2 employees.
The manufacturing sector uses the lowest number of gig workers, with only 2% of the workers employed as 1099-MISC contractors or short-term W-2 employees[3].
Gig Worker Share in the US by Industry
Gig Worker Income by Industry
Gig workers reportedly bring in from $1,080 to $11,130 in average monthly income depending on the industry, with mining paying the most ($11,130) for 1099-MISC workers and manufacturing ($3,180) leading the way for short-term W-2 employees[3].
Gig Worker Income in the US by Industry
Gig Work as a Main or Side Job
Pew Research reports that gig work has been a side job for nearly 7 in 10 (68%) recent gig workers in the US, while only one-third (31%) claim it was their main source of income[1].
According to Federal Reserve data, nearly half (47%) of gig workers in the US also had full-time roles, while 22% were employed on a part-time basis. Only 11% of American gig workers are reported to make at least 50% of their income from gigs[6].
Reasons for Taking Up Gig Jobs
According to a Pew Research Center survey, more than half of gig platform workers report taking up gig jobs due to income-related reasons, particularly “wanting to save up extra money” (56%) and “needing to cover gaps, changes in income (52%)”[1].
Other common reasons for participating in the gig economy include the ability to control their schedule (49%), and wanting to be their own boss (35%)[1].
Based on ADP insights, work-life balance (44%) and enjoyment (38%) are the top reasons to work among 1099-MISC contractors in the US. For employees in traditional work arrangements, benefits (51%) and financial security (40%) are the driving factors[3].
Types of Gig Work in the US
Due to the lack of a common definition for gig work, some researchers include gig work completed offline and online (as in the case of the Federal Reserve), while others, like the Pew Research Center, focus primarily on online platform work.
Based on the Federal Reserve’s analysis of sales activities, 9% of American adults sold goods online, while another 5% sold goods at flea markets as gig workers. A total of 13% of adults performed some type of sales activity as gig workers[6].
Types of Gig Work Activities (sales activity)
According to the same analysis looking into service activities, 16% of gig workers completed some work related to service, including 6% for house cleaning, and property maintenance, and 3% for childcare or eldercare services[6].
Types of Gig Work Activities (service activity)
When looking specifically into online gig platforms, the largest share of Americans reported making deliveries (7%), performing household tasks (6%), or driving for a ride-hailing app (5%) as one of the most common gig tasks[1].
Types of Gig Work Activities (online gig platforms)
Gig Worker’s Benefits and Protections
The gig economy offers workers a high degree of flexibility, but workers in the gig economy may lack access to important benefits associated with traditional employment.
- 24% of gig workers reported having no health insurance, with 58% of those citing prohibitive cost as an obstacle[7].
- 48% of gig workers say their employment status impairs their access to health insurance[8].
- Only 21.9% of nontraditional workers participated in an employer-sponsored retirement plan in 2020[9].
- 14% of gig workers earned less than the Federal minimum wage on an hourly basis. 29% earned less than their state’s minimum wage [10].
- 19% of gig workers reported going hungry because they couldn’t afford food, and 30% used Supplementary Nutritional Assistance Program (SNAP) benefits, twice the rate of regular workers[10].
- 37% of gig workers reported being treated rudely. 35% have felt unsafe while working, and 19% have experienced unwanted sexual advances while working[1].
According to the Economic Policy Institute, gig workers lack overtime pay, unemployment insurance, health and safety protections, and the right to a union. The lack of paid sick days, family leave, and vacation time can lead to overwork and burnout[10].
Conclusion
The gig economy offers both advantages and disadvantages to workers. Flexibility, the ability to control schedules, the ability to supplement conventional earnings, and being your own boss are among the primary advantages.
On the downside, gig workers may lack important benefits like health insurance and employer-sponsored retirement plans, and they may have to manage more complex tax situations. Workers can manage these issues on their own, but it takes extra effort. Gig workers in less skilled occupations sometimes take on sub-minimum wages just to gain experience, with little protection from exploitative practices.
The gig economy offers both positives and negatives, but for better or worse, it’s here to stay!
The content on finmasters.com is for educational and informational purposes only and should not be construed as professional financial advice. Finmasters is not a financial institution and does not provide any financial products or services. We strive to provide up-to-date information but make no warranties regarding the accuracy of our information.
