Where Are Online Workers Located? — Oxford Internet Institute Tool Breaks it Down

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This is the second of a series of posts reporting on recent findings of the Oxford Internet Institute’s iLabour Project.* We first reported on the project back in September 2016.

In the first article of this series, Online Gig Economy Up 26% Over Last Year: Oxford Internet Institute, we covered the demand side of the global online work marketplace — specifically overall growth in projects posted in the aggregate and by region/country and occupational category. It bears repeating here that the subject workforce is what has been called “digitally delivered” labor (i.e., online freelancing and crowd work) consisting of “temporary and project-based work conducted remotely over digital platforms.”

In this article, we summarize new iLabour Project research focused on the demand side of the marketplace, in particular the number of online workers (by region/country and occupational category). This research was recently released as the “Online Labour Index Worker Supplement.” In reality, the research — though relying on a subset of the same platform data sources — has been developed with a different methodology that calculates the number of “active users” by region/country location and occupational category. The methodology, which is a bit complicated, can be found here. (Note: I was able to find some approximate validation of most of the iLabour findings, using an alternative data set that is a few years old.)

Visualizing Where Online Labor Sits

Using the Online Labour Project “visualization tool,” I generated the charts below. The first shows the percentage of workers in six global regions, as well as the breakdown by six occupational categories.

As can be seen, Asia, which includes India and Pakistan, unsurprisingly represents by far the largest proportion of “active” online workers. (Europe and North America combined account for less than Asia.) It is perhaps notable that, in Asia (as well as in North America), the percentage of workers performing “creative and media” and “sales and marketing” projects exceeds the percentage of workers performing “software development and technology” projects.

Looking at the top 20 countries, India dominates, with 50% of workers performing software/IT projects:

Clearly, India, Bangladesh, Pakistan and the Philippines account for the lion’s share of online workers across the occupational categories of software/IT, creative and media, and sales and marketing.

The chart below highlights the proportional differences of worker occupations across the top 20 countries:

One can see that, on this basis, software/IT workers in India, Ukraine and Russia account for close to the same percentage of all online workers in each of those counties.

Spend Matters Perspectives

There many observations that can be made from the data using the iLabour Project visualization tool (try it out). However, there are also several key observations that can be taken away here:

  • Roughly 60% of online workers are located in Asia (namely India, Pakistan, Bangladesh and the Philippines).
  • The largest occupational categories of online workers are software/IT (30%+), creative and media (25%+), and sales and marketing (under 20%). Writing and translation is also important, at about 13%.
  • Harkening back to the demand-side data of our prior article, on the demand side, the U.S. and Canada account for over 50% of the global total projects requested. About 65% of all projects requested in the U.S. and Canada are software/IT and creative and multimedia projects (about 40% and 25%, respectively).

While the two data sets (demand/new projects requested versus supply/“active” online workers) are apples and oranges, it is clear that online work exchange activity today is largely between the U.S. and certain less-developed Asian countries. From our perspective, this is likely true for three main reasons: (1) wage arbitrage (frequently), (2) lower transaction costs and (3) supply of skilled labor/talent (with shortages in the U.S.).

This should be music to the ears of a contingent workforce procurement professional: potential cost savings and new sources of scarce resource, with digitally enabled sourcing. Granted, there are complexities and hurdles that must be addressed, but this supply of labor/talent is hard to ignore. And, apparently, many organizations have not ignored it and are using it. Even in larger enterprises, individuals and departments outside of contingent workforce managed spend are starting to experiment with online labor. (I can’t verify this, but one platform provider told me that — based on email addresses — there are such users spread throughout over 80% of Fortune 500 companies).

In the next and final installment of this series, we’ll cover some of the findings of iLabour Project research focused on two cases of significant enterprise adoption.

*Sources of data/research: Kässi, O. & Lehdonvirta, V. (2016) Online Labour Index: Measuring the Online Gig Economy for Policy and Research. Paper presented at Internet, Politics & Policy 2016, 22-23 September, Oxford, U.K. http://ilabour.oii.ox.ac.uk/online-labour-index/.

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