Millions of people are working erratic shifts, or scrambling for extra cash
Even though the official unemployment rate has dropped to a 18-year low of 3.8%, the economy is still broken for a great number of Americans who are living a precarious existence – nearly invisible and economically marginalized.
For millions of Americans, the security and income of a steady 9-to-5 job is as far out of reach as it was during the worst of the Great Recession. Some, of course, have simply given up on finding any job, discouraged about their employment prospects after so many years out of work.
Many others have resorted to scrambling for a buck here and a buck there, cobbling together a patchwork of irregular hours and side hustles.
When viewed from 35,000 feet, the economy looks pretty strong, with stellar profits, higher household consumption and a tight labor market. But most of the economic data glosses over these forgotten Americans. This new army of contingent “workers” don’t seem to fit any of the old classifications. They aren’t employees exactly, nor do they act much like entrepreneurs.
How widespread is this phenomenon? Some say these so-called “alternative work arrangements” are pervasive, encompassing tens of millions of workers. Others say the “gig economy” is tiny, amounting to about one of every thousand hours worked in the United States. It’s hard to say what the right answer is because we’re still arguing over the sparse data we have. Nor do we have common definitions of what we’re trying to study.
78 million hustling for dimes on the side
The Federal Reserve has just published a study that sheds some light on this hidden part of the economy. The Survey of Household Economics and Decisionmaking delves into how people feel about their economic lives and why they make the decisions they do. Surveys like this add shadings that the regular data miss.
The SHED found that about 31% of adults participate in what the Fed called “the gig economy” – work done outside of regular employment structures. That looks huge — about 78 million people. However, most of these people are working five hours a month or less on their side hustles, and the kinds of activities this survey considers to be “gigs” is far broader than what other researchers consider, including selling goods and services online or in real life, or picking up a few hours of babysitting.
About 78 million Americans earn some extra money with a hustle on the side.
Other researchers have narrowed their focus to online gigs such as driving for Uber or Lyft. Economist Larry Mishel of the Economic Policy Institute recently published research showing that about 1% of American workers were engaged in online hustles such as Uber or TaskRabbit.
Few are getting rich off their gigs. Mishel found that Uber drivers made $11.77 per hour on average after deducting their overhead and marginal costs but before paying payroll and income taxes. Most work less than 20 hours a week, and turnover is very high.
A majority of the much-larger group identified as gig workers in the Fed study also work at a main job. Gig work is just a side hustle. For three-fourths of them, gig work provides less than 10% of their family income. Only 5% of gig workers get half or more of their income that way.
But that doesn’t mean it isn’t important to them. Gig work is great for smoothing out unexpected changes in income and to meet unexpected expenses. About 45% of gig workers say the money they earn — as little as it is — is important to them.
One of the great advantages of having a side hustle is that it’s flexible. You work when it’s convenient or necessary for you, not when the boss needs you.
When do you sleep?
Millions of workers would love to have that kind of flexibility, or even a regular schedule that they could count on.
About three-fourths of those with traditional jobs normally work the same hours each shift, but about 16% — 25 million workers — have varied schedules based on the boss’s needs, the Fed study found. Irregular schedules are twice as prevalent in retail, food services, wholesale and entertainment services. These erratic schedules are more common among part-time workers, and among those armed with only a high-school diploma or less.
About half of these workers get less than three days’ notice for their schedule. About a third get a day or less. Many are on call, which means they aren’t working nor can they really make other plans.
Imagine for a second trying to juggle life when you have no idea what time you’ll have to go to work, or even if you’ll be offered a shift at all. How would you fit in school, or family responsibilities, or a second job? Even regular sleep is a challenge.
Some people love this kind of job, especially if they have some flexibility in their lives about when they’ll work, and how much income they’ll get week by week. If you have a bit of a financial cushion and some free time, these jobs can be great.
But for many others, these jobs can be intolerable. In one study, workers were willing to give up about a fifth of their wages in exchange for a more predictable work life. No wonder these jobs have high turnover.
Economy is still failing millions
Not everybody who has a side hustle or who works a erratic shift wants a regular full-time job, of course. But millions of people would like a job — or a better job, with higher pay, more reliable hours, more generous benefits, and more humane working conditions.
The only way that can happen on a broad scale is for the economy to get even stronger. The Fed ought to get out of the clouds and see that the economy is still failing for many Americans.
The Fed might think that 3.8% unemployment is the “Mission Accomplished” signal. Millions of people scrambling for dimes disagree.
The post If The Economy Is So Great, Why Are 78 Million Americans Hustling For Dimes? appeared first on crude-oil.news.