‘Gig’ economy may not be the workforce of the future

Statistics Canada data estimates 2.18 million are taking part in some form of temporary work.

The “gig” economy might not be the new frontier for North America’s workforce after all.

From Uber to Task Rabbit to Your-Mechanic, so-called gig work has been widely seen as ideal for people who want the flexibility and independence that traditional jobs don’t offer.

Yet the evidence is growing that over time, they don’t deliver the financial returns many expect. And they don’t appear to be reshaping the workforce south of the border, though it appears to be a different situation here in Canada.

Over the past two years, for example, pay for gig workers in the U.S. has dropped and they are earning a growing share of their income elsewhere, a new study finds. Most Americans who earn income through online platforms do so for only a few months each year, according to the study by the JPMorgan Chase Institute released Monday.

One reason is that some people who experimented with gig work have likely landed traditional jobs as the economy has improved. Drivers for Uber, Lyft and other transportation services, for example, now collectively earn only about half as much each month as they did five years ago.

The new American data echo other evidence that such online platforms, despite deploying cutting-edge real-time technology, now look less like the future of work.

A U.S. government report in July concluded that the proportion of independent workers has actually declined slightly in the past decade.

“People aren’t relying on platforms for their primary source of income,” said Fiona Grieg, director of consumer research for the institute and co-author of the study.

The gig economy in Canada, meanwhile, continues to grow at “a phenomenal rate that shows no signs of slowing,” according to a July report from BMO Wealth Management based on a survey of temporary workers.

The report cited Statistics Canada data estimating that 2.18 million Canadians are taking part in some form of temporary work — a number that has risen significantly since the 2008 recession.

The Ottawa agency is attempting to fill in gaps in data about the digital economy through a major survey conducted over this summer that gathered information on how fast the digital economy is growing, among other things. Results of the research are expected this fall.

“We are working on it,” said senior Statistics Canada director Jim Tebrake.

A report in May by researchers associated with the University of Toronto adds that the gig economy is small but growing, referring to StatCan data that shows 9.5 per cent of adults participated between November 2015 and October 2016.

“Unfortunately, we didn’t actually measure the gig economy in Canada and so can’t speak to that directly,” said researcher Uttam Bajwa “We can say that JP Morgan’s numbers appear low (they definitely serve a different and more traditional demographic) and that gig work can be invisible and participation is very difficult to measure.”

The JP Morgan data is derived from a sample of 39 million JPMorgan chequing accounts studied over 51⁄ years. In 2 March 2018, about 1.6 per cent of families participated in the gig economy, equivalent to about two million households. That is barely up from the 1.5 per cent of a year earlier.