Bobby Short at the Café Carlyle in New York City. Hank Williams at Nashville's Grand Ole Opry. A trumpet player in the pit, a pianist at a bar. All these musicians have been gigging—that is, they've performed live for pay. The term gig is thought to be shorthand for engagement and has been around since the early years of the 20th century
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Nowadays, it seems that a lot more workers—not just musicians—gig. In the gig economy, independent workers perform short-term jobs for companies or individuals. Many of us presume that most of those jobs are somehow enabled by technology. Now some counterintuitive data about the gig economy comes from the Federal Reserve's Survey of Household Economics and Decisionmaking (SHED).
The SHED finds that three in 10 U.S. adults did some gig work at least once in the month prior to the survey. The survey defines gigging as selling goods online or renting out property, as well as providing personal services like yard work or ride sharing. Among gig activities, child- and elder-care, cleaning, and property maintenance were most common. Half of gig workers indicated they spent five hours or less on gig work in the month prior.
One finding that surprised me: the gig economy is an offline economy. Compared to the 30 percent of adults who did some gig work, just 3 percent of adults used a website or mobile app to find that work. Said another way, that means that just one in 10 gig workers engage in what this paper from the Boston Fed calls "internet platform-based work."
My immediate reaction: how can that be? I took 15 ride shares in April, one every other day. Surely there are more Uber and Lyft drivers out there. My second thought: my mom gets rides, too. When Mom wants a ride, she makes a call on her landline phone to a gig worker for a local agency that helps seniors live independently. As the SHED report puts it, "Most of [gig] activities predate the internet." Driving, housekeeping, babysitting, and lawn maintenance all have been around for a long time.
And, in fact, the SHED estimate of internet platform-based work is higher than some others, because the work is not limited to providing services. It includes, as noted above, selling stuff via online marketplaces. In comparison, the Contingent Worker Supplement from the U.S. Bureau of Labor Statistics (BLS) finds that in May 2017, 1 percent of workers engaged in "electronically mediated work," defined as "short jobs or tasks that workers find through websites or mobile apps that both connect them with customers and arrange payment for the tasks." (Note that the SHED estimate is a share of adults and the BLS is a share of workers ["employed persons," defined here].)
Like the gigs, some ways to pay for gig work predate the internet. My mom pays her driver directly on the same day with paper. And, in fact, the 2017 Survey of Consumer Payment Choice found that 70 percent of person-to-person (P2P) payments were made with cash or checks.
I pay the ride-share app with a fingerprint through an intermediary. The driver, paid indirectly by me, gets an ACH credit to a bank account or a prepaid card load. Many get paid the same day or right after the ride. About half of those I speak with don't mind the 50 cent fee to get paid sooner.
Two ways to arrange a ride. Two ways to pay. Both relevant in the 21st century.
By Claire Greene, a payments risk expert in the Retail Payments Risk Forum at the Atlanta Fed