The Gig Economy: Have We Missed the Forest for the Trees — or Vice Versa?

gig economy

These days, one cannot swing a dead cat, as the saying goes, without having contact with the “gig economy.” The media are all aflutter — or shall we say, atwitter — about the “gig economy” or “on-demand economy,” both of which usually mean people doing low-skill, low-wage jobs on a contingent basis. The labor economics terms include “precarious jobs” and “casualization of labor.”  

More recently, the issue of worker classification has become so popularized, I am waiting to see something about it printed on the front page of some tabloid at the supermarket checkout alongside paparazzi beach photos of an overweight celebrity. I can see it now: “Co-employer Reveals All!”

Now, I’m not judging the “gig economy” — in many ways it’s good for a lot of people, including workers, many of whom would not have any job elsewhere. And having less friction in the labor market is a good thing. Right?

I am not judging the gig economy itself. I am really asking a question about, and perhaps also judging, “us.” The question is: Have we lost our bearings? Has our attention, the span of which we know is limited, been misdirected away from something much more critical?

I am not talking about the forest or the trees. I am talking about STEM jobs and education.

A National Math and Science Initiative report, “Why Stem Matters” — not to be confused with Why Spend Matters — had some statistics to share on the subject:

  • STEM job creation over the next 10 years will outpace non-STEM jobs significantly, growing 17%, as compared with 9.8% for non-stem positions.
  • According to the U.S. Department of Commerce, people in STEM fields can expect to earn 26% more money on average and be less likely to experience job loss.
  • The STEM degree holders also tend to enjoy higher earnings overall, regardless of whether they work in STEM or non-STEM occupations.
  • Sixty percent of the new jobs that will open in the 21st century will require skills possessed by only 20% of the current workforce.
  • The U.S. may be short as many as 3 million high-skilled workers by 2018.

You read that right: The U.S. may be short as many as 3 million high-skilled workers by 2018. But it doesn’t appear that we will have a deficit of gig workers.  

The report cites a number of other disturbing statistics. For example, “American universities, however, only award about a third of the bachelor’s degrees in science and engineering as Asian universities. Worldwide, the United States ranks 17th in the number of science degrees it awards.”

I could go on, but you get the picture. Labor economists talk about a bifurcated workforce, as our educational system, at all levels, continues its decline.

Another disturbing fact about the gig economy is that many of the jobs that it is creating are likely to be automated. Where will Uber drivers be when, in some number of years, driverless vehicles make them unnecessary?

So why all of this attention to, and glorification of, the gig economy, when more serious problems lurk below the surface, and we all need to focus on root causes. Are we missing the trees for the forest?

Voices (2)

  1. Andrew Karpie:

    Mike, Thank you as always for joining the discussion with you point of view. Employers are definitely not hiring people who do not have skills needed for the jobs. Andrew

  2. Mike Hammer:

    The stats for open to fill full-time skilled jobs has not changed for a decade, so why is this new news? Could it be employers are NOT hiring, but are automating and using “gigers” to fill the gaps??? Underneath all the data and surveys, most employers just are not hiring full-time workers if they can maintain profits and sustainability using technologies heretofore to costly to own and complicated to maintain. Hence, the acceleration of driverless cars, etc. Technology can produce great innovations, but will replace fewer and fewer jobs it destroys in the process. I’ve been writing about the emerging Gig Economy since 2008. My research has found “alarms” about the decoupling of full time wages with the trend of Moore’s Law dating back to the 80’s. I wrote my own book on this subject as the boomer population (equal to the population of19th largest country on the planet) move to social security and most need “gigs” to make ends meet. The in migration of refugees, legal and illegal workers will only further burden our economic ability to grow at a rate to sustain incomes with discretionary spending capabilities. Yes, SPEND does matter, especially if we have flat consumer spending.

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