Employment and Jobs

The Gig Economy State-By-State

January 14, 2020  • Shelly Steward

As policymakers increasingly show interest in the so-called “gig economy” and look for solutions to the challenges faced by non-traditional workers, accurate data is more important than ever. But those focusing on state and local trends often struggle to find relevant information. Those seeking data about local trends, though, are not completely without hope. This post reviews state-level data sources that are available and suggests additional strategies that policymakers can use to improve data for their jurisdictions.

No source provides accurate and comprehensive data on the full range of non-traditional work arrangements at the state level. The Bureau of Labor Statistics’ (BLS) Contingent Worker Supplement, one of the best sources of information on non-traditional work, was not intended to be representative at the state level. However, a handful of widely available data sources do offer state-by-state measures of specific worker populations that reflect trends in non-traditional work.

The Current Population Survey (CPS), collected monthly via telephone and in-person interviews by the BLS, is the primary source of employment statistics for the United States. It sizes the workforce, including how many are self-employed, distinguishing between incorporated and unincorporated self-employed workers. Although unincorporated self-employment is a particularly narrow definition of non-traditional work, and research suggests that many respondents are unsure of their own classification, the CPS is consistently collected and representative at the state and local level, making it one of the first sources to consult. It has shown a slight decline in rates of self-employment in the past decade, with the highest concentrations in the West, the Rocky Mountains, and New England.

Nonemployer Statistics, extracted from business tax records by the U.S. Census Bureau, are a count of business establishments in the U.S. that have no paid employees, are subject to federal income tax, and have over $1,000 in annual gross receipts. Like the Current Population Survey, this measure only includes those who are self-employed, and excludes non-traditional workers classified as employees. As an administrative data source, it does not rely on respondents’ understanding of their work arrangement; however, it does rely on them filing taxes accurately, which can be particularly challenging for self-employed workers. Consistently collected since 1997, Nonemployer Statistics show an increase in the number of nonemployer business establishments in recent years, with particularly rapid growth in taxi and limousine services, which many interpret to reflect the advent of ridesharing.

Although large, public data sources speak most accurately to state and local variation, some private sources shed further light. The JPMorgan Chase Institute, which has compiled online platform income data from JPMorgan Chase account holders, provides information for 27 metropolitan areas. Although limited to workers with JPMorgan Chase bank accounts, the reports published by the Institute are one of the most comprehensive sources of data on online platform work. In addition, the Internet Association, a trade group of technology companies, has compiled the number of platform worker accounts held in each state. 

Although more comprehensive, more representative data would improve our understanding and policymakers’ ability to develop responsive solutions, enough data on non-traditional work exists today for state and local policymakers to learn and start acting.

In addition, state policymakers and agencies can work to develop new state-level knowledge, building on the sources outlined above and identifying resources within individual states. Reviewing what data is already held, and making plans to fill in any gaps, are important steps in developing responsive policy. For example, state departments of revenue may be able to analyze tax returns to identify trends in work arrangements, while departments of labor may be able to utilize unemployment insurance records. Coordinating across agencies and branches can allow policymakers to best use what data already exists, and can maximize the impact of new information. 

Several states have embarked on these sorts of efforts. The National Governor’s Association is coordinating a consortium of states to examine on-demand work and consider policy solutions to the challenges faced by on-demand workers, which has included clarifying definitions across participating states and laying the groundwork for improved state-level data collection.

In July 2019, at the direction of the state’s legislature, Washington’s Department of Commerce published a report on the number, income, and needs of independent contractors, analyzing both existing data sources as well an original survey and focus group observations. In addition to estimating the size and growth of the independent workforce, it highlighted several of the unique challenges faced by the state’s contractors, including financial insecurity and a lack of institutional supports.

If a coordinated state-wide effort is not possible, specific public or private entities can undertake an analysis. CareerSource Florida, the state’s workforce policy and investment board, released a report on non-traditional work that relies on both national and state data.

At the state level and beyond, accurate, consistent, and valid data are needed to inform labor policies and ensure work is an avenue to security and prosperity. Drawing on available data while improving collection and collaboration can equip states to be at the forefront of policy innovation.

To learn more, visit the Gig Economy Data Hub.