These Members have raised questions about the size and composition of the gig workforce, the proper classification of gig workers (i.e., as employees or independent contractors), the potential for gig work to create work opportunities for unemployed or underemployed workers, and implications of gig work for worker protections and access to traditional employment-based benefits. An Overview of the Gig Economy

The gig economy is the collection of markets that match providers to consumers on a gig (or job) basis in support of on-demand commerce. In the basic model, gig workers enter into formal agreements with on-demand companies to provide services to the company's clients. Prospective clients request services through an Internet-based technological platform or smartphone application that allows them to search for providers or to specify jobs. Providers (i.e., gig workers) engaged by the on-demand company provide the requested services and are compensated for the jobs. With some exceptions, on-demand companies view providers as independent contractors—not employees—using their platforms to obtain referrals and transact with clients. This designation is frequently made explicit in the formal agreement that establishes the terms of the provider-company relationship. In some ways, then, the gig economy can be viewed as an expansion of traditional freelance work (i.e., self-employed workers who generate income through a series of jobs and projects). However, gig jobs may differ from traditional freelance jobs in a few ways. Because gig workers do not need to invest in establishing a company and marketing to a consumer base, operating costs may be lower and allow workers' participation to be more transitory in the gig market (i.e., they have greater flexibility around the number of hours worked and scheduling). On-demand companies collect commissions from providers for jobs solicited through the company platform. Some on-demand companies discourage or bar providers from accepting work outside the platform from clients who use the company's platform. This is a potentially important difference between gig work and traditional freelance work, because it curtails the provider's ability to build a client base or operate outside the platform. Measuring and characterizing the gig economy workforce are challenging tasks for several reasons. Bureau of Labor Statistics Data: Contingent Workers, Alternative Employment Arrangements, and Self-Employment

Existing large-scale labor force survey data on nontraditional work arrangements and self-employment may provide some insights, but are imperfect proxy measures of contemporary gig economy participants. Other Data Sources: Company Data and Small-Scale Surveys

A small but growing literature examines data collected from individual companies operating in the gig economy or pockets of gig economy workers. However, with few exceptions, they do not profile the gig economy as a whole; instead, they can be viewed as snapshots of certain groups of gig workers. Whether a worker in the gig economy may be considered an employee rather than an independent contractor is significant for purposes of various federal labor and employment laws. In general, employees enjoy the protections and benefits provided by such laws, whereas independent contractors are not covered. Two laws, in particular, have drawn recent attention. Voluntary Employer-Provided Benefits

Beyond federally mandated labor standards, certain other benefits often associated with traditional employment relationships may not be available in the same form to workers in the gig economy. New mechanisms, such as portable benefits or risk-pooling, may serve to provide benefits to workers in the on-demand or gig economy.
The gig economy is the collection of markets that match providers to consumers on a gig (or job) basis in support of on-demand commerce. In the basic model, gig workers enter into formal agreements with on-demand companies (e.g., Uber, TaskRabbit) to provide services to the company's clients. Prospective clients request services through an Internet-based technological platform or smartphone application that allows them to search for providers or to specify jobs. Providers (i.e., gig workers) engaged by the on-demand company provide the requested service and are compensated for the jobs.
Recent trends in on-demand commerce suggest that gig workers may represent a growing segment of the U.S. labor market. In response, some Members of Congress have raised questions, for example, about the size of the gig workforce, how workers are using gig work, and the implications of the gig economy for labor standards and livelihoods more generally.
With some exceptions, on-demand companies view providers as independent contractors (i.e., not employees) using the companies' platforms to obtain referrals and transact with clients. This designation is frequently made explicit in the formal agreement that establishes the terms of the provider-company relationship. In some ways, the gig economy can be viewed as an expansion of traditional freelance work (i.e., self-employed workers who generate income through a series of jobs and projects).
However, gig jobs may differ from traditional freelance jobs in a few ways. For example, coordination of jobs through an on-demand company reduces entry and operating costs for providers and allows workers' participation to be more transitory in gig markets (i.e., they have greater flexibility around work hours). The terms placed around providers' use of some tech platforms may further set gig work apart. For example, some on-demand companies discourage providers from accepting work outside the platform from certain clients. This is a potentially important difference between gig work and traditional freelance work because it may limit the provider's ability to build a client base and operate outside the platform.
Characterizing the gig economy workforce (i.e., those providing services brokered through tech-based platforms) is challenging along several fronts. To date, no large-scale official data have been collected, and there remains considerable uncertainty about how to best measure this segment of the labor force. Existing large-scale labor force survey data from the Bureau of Labor Statistics (BLS) and the U.S. Census Bureau may provide some insights, but are imperfect proxy measures of contemporary gig economy participants. A small literature examines data collected by individual companies operating in the gig economy or from pockets of gig-economy workers. As such, these analyses can be viewed as snapshots of certain gig workers, but they are not necessarily representative of the full market.
The apparent availability of gig jobs and the flexibility they seem to provide workers are frequently touted features of the gig economy. However, to the extent that gig-economy workers are viewed as independent contractors, gig jobs differ from traditional employment in notable ways. First, whether a worker in the gig economy may be considered an employee rather than an independent contractor is significant for purposes of various federal labor and employment laws. In general, employees enjoy the protections and benefits provided by such laws, whereas independent contractors are not covered. Two laws, in particular, the Fair Labor Standards Act and the National Labor Relations Act, have drawn recent attention.
In addition, certain other benefits (e.g., paid sick leave, health insurance, retirement benefits) that are often associated with traditional employment relationships may not be available in the same form to workers in the gig economy. Should Congress choose to consider ways of increasing access to such benefits for nontraditional employees, new mechanisms, such as portable benefits or risk-pooling, could serve to provide benefits to workers in the gig economy.