Last week in our article Confusion Reigns Over the Number of People Working in the Online Gig Economy we reported that a recent study developed jointly by Burson-Marsteller, The Aspen Institute’s Future of Work Initiative and TIME found that 45 million Americans have worked in the on-demand economy.
We suggested the reason why their numbers are so much larger than other sources – our work, for example found about 3.2 million Americans are working in the on-demand economy – was likely due to differences in definitions and study methods.
We had a chance to talk with the research folks who worked on this study and it turned out this is correct. They, not surprisingly, used different industry definitions and study methods.
The key reasons for the differences between their results and ours are:
1. Their study defines the on-demand economy much more broadly than we do.
The study from Burson-Marsteller, The Aspen Institute’s Future of Work Initiative and TIME was designed to capture all work related to activities in the areas they studied.
They provided survey respondents with online examples but did not exclude on-demand or gig work that was not found or done online.
Because of this, they phrased their questions so respondents could consider any work and did not limit their definitions or questions to specific, individual online services or platforms.
Additionally, their definition and questions could result in respondents including work found via sites like Craigslist (which they specifically listed as an example) as being on-demand economy work.
We limit our definition of the on-demand economy workers to people who work with online work intermediation platforms that actively facilitate the connection of buyers and sellers of services such as Uber, Upwork, Fiverr, etc.
We exclude people who find work via sites that simply provide job listings, classified ads (such as Craigslist) or links to work opportunities (such as Nextdoor.com).
We also don't include work found offline in our definition of the on-demand economy.
These differences alone helps explain the difference in the numbers and why their numbers are much larger than ours.
2. Their study is based on cumulative data; ours is based on current data
The study from Burson-Marsteller/The Aspen Institute’s Future of Work Initiative and TIME asked respondents if they had ever offered services in the online on-demand/sharing/gig economy. This means someone who drove for Uber two years ago but hasn’t done any on-demand work since could be included in their numbers.
Our studies are based on who is currently working in the on-demand economy. This, too, obviously leads to larger numbers in their study.
There are a number of other smaller differences in study definitions and methods and pretty much all of these led to their study getting bigger numbers than we do.
So who’s right?
The quick answer is both of us – or maybe neither of us. Both approaches are valid from a methodological standpoint and both yield interesting results.
But since we’re looking at very different worker segments, the studies really aren’t directly comparable.
So getting back to our headline, are 45 million Americans working in the on-demand economy as is being reported by some of the media?
The Burson-Marsteller, The Aspen Institute’s Future of Work Initiative and TIME (they really need a shorter name) study’s numbers are cumulative, so maybe 45 million have worked in the on-demand economy as they’ve defined it.
But 45 million are not working in it today, nor does their study provide data on how many Americans are currently working in the on demand economy.
That their study is based on cumulative numbers is described in the study materials. But unfortunately some of the press is mistakenly reporting the numbers as current.
Due to varying study definitions and methods confusion will continue to reign about this sector of the economy. No doubt there will be yet more studies with new and different definitions - and very different results – that will add to this confusion.
The good news for us here at Small Business Labs is this means we will continue to have jobs - both as contributors to the confusion and folks trying to explain it.