A lot of people assume that a hefty share of working people earn money in the “platform economy”—also called the “gig economy” or the “on-demand economy.”
According to a new report, however, only 0.5% of adults in the United States earn income from digital labor platforms—such as Uber and TaskRabbit—that are used to provide labor or services. That works out to a little more than 1 million people.
Moreover, in 2016 the labor platform workforce has been growing at a much slower rate than in previous years, thanks in part to falling pay and high turnover. The authors of the report conclude that high turnover and an improving traditional labor market may hinder the future growth of the platform economy.
Here are a few of their findings:
- Average monthly earnings from labor platforms fell 6% between June 2014 and June 2016.
- Three out of six labor platform workers exit the platform economy within 12 months, while one out of six is new to the platform economy in any given month.
- In addition to the 0.5% of adults who earned income from digital labor platforms in June 2016, another 0.4% earned income from digital capital platforms— such as Airbnb and eBay—that are used to rent assets or sell goods peer to peer.
- Only 1% of platform workers earn income from both labor and capital platforms; only 3% earn income from more than one digital capital platform; and 18% earn income from more than one digital labor platform.
The new report, by researchers at the JPMorgan Chase Institute, represents the best available data on the platform economy. The authors examined data from 6.3 million core checking account customers of JPMorgan Chase & Co. and identified transactions involving 30 different digital platforms.
In a previous report published earlier this year, the same researchers found that as of September 2015, 0.4% of adults earned income from digital labor platforms and 0.6% earned income from digital capital platforms in a given month, for a total of 1.0% of adults, or 2.5 million people.