John Harris has written a long piece in the Guardian asking, “Does the left have a future?” It’s an excellent read and I will write a longer piece on it soon. But, on the subject of changes in the labour market, he said this:
One in seven Britons is now self-employed. In the US, Forbes magazine has predicted that by 2020, 50% of people will at least partly work on a freelance basis. In 2015, the Organisation for Economic Cooperation and Development reported that since 1995, “non-standard” jobs – which is to say, temporary, part-time or self-employed positions – accounted for the whole of net jobs growth in the UK since 1995.
While the first sentence is true, the rest of the paragraph is at best misleading and at worst total nonsense. It’s not the first time I have seen these factoids and it probably won’t be the last.
The “50% of Americans will be freelancers by 2020” meme just refuses to die, despite numerous stakes having been driven through its heart by US labour economists. Some of these large figures are based on a survey that used a very wide definition of gig economy workers, which included what we in the UK would call part-timers, temporary workers, agency workers and those on zero-hours contracts, and which was carried out in the depths of a recession when full-time jobs were at their lowest. As Bloomberg’s Justin Fox said, if you take out standard part-time workers, even the most generous definition of freelancers still only gets you to around one in five workers, down from a recession peak of just below 22 percent.
Most of the US data show similar trends. The number of people with multiple jobs has fallen, as have the proportions of involuntary part-time workers, contract workers and workers in businesses with 1-4 employees. Compared to other developed economies, full-time employment in America is relatively high and, after falling during the recession, increased again as the economy recovered.
It is true that a survey by the Freelancers’ Union found that a third of Americans gain some of their income from doing some form of freelance work but that proportion hasn’t increased by much in recent years. Furthermore, the definition used was so broad that it included people whose income from freelancing wasn’t even enough to be taxable. In other words, it captured anyone who had done a bit of work in their spare time or sold a few things on eBay. Some people are using online platforms to supplement their income and this number will no doubt increase. But to suggest that this represents a major shift towards freelance work in the US labour market is something of an exaggeration.
If the statement about the US economy is misleading, the one about the UK is just plain wrong. Even so, like its American counterpart, it too crops up all over the place. Apparently, data from the OECD suggest that all the job growth in the UK over the past 20 years has been in non-standard work, meaning part-time, temporary or self-employment. But the only OECD data I could find, from this report in May 2015, say that there has been very little change in the proportion of non-standard workers in the UK. There has been an increase since the 1980s but almost none over the last twenty years.
In fact, as Michael O’Connor pointed out, most of the change in employment since 1995 has come from full-time employee jobs.
It is true that around half of the employment growth since the recession has been due to part-time and self-employment and that the growth in full-time employee jobs took much longer to get going. As a consequence the proportion of workers in full-time employee jobs has fallen slightly but it is still over 60 percent.
Of those of us in work, then, 3 in 5 are in full-time employee jobs. That’s not to say there haven’t been shifts in the labour market that have made things difficult for some people. Even for those in full-time employment, job protection, from both unions and the law, isn’t as strong as it once was. There has also been a pay squeeze and an increase in low-paid zero hours work and self-employment. The job recovery in some parts of the country is still looking precarious.
Of course there have been changes in the labour market both here and in the USA but it is important to keep such things in perspective. If the number of freelancers in the US really were nearing 50 percent and if all the job growth in the UK really had been due to part-time and self-employment, both governments would be facing fiscal crises far worse than their current ones. These shifts in the nature of work present challenges for the left and for trade unions as well as for governments and for people trying to find secure work. There is no need to over-state the case with wild and spurious numbers though. Things are difficult enough as it is.