A Provocative Assessment of the On-Demand Workforce
Thumbtack, America’s largest online professional services marketplace, released a new original report: “Beyond the Gig Economy: How New Technologies are Reshaping the Future of Work.” It features a provocative assessment of the current gig economy, a glimpse into the workforce of the future, and some specific policy recommendations to support the emerging class of small business owners and entrepreneurs.
“Popular discussions about the gig economy have focused on the proliferation of on-demand, low-skilled jobs such as Uber drivers and Instacart shoppers, consisting mostly of people looking to earn extra income, but who are not building a lifelong career or achieving long term economic stability,” said Marco Zappacosta, founder and CEO of Thumbtack. “But technology is also transforming work for individuals and small businesses, creating unprecedented opportunity for a growing class of skilled professionals. This new report from Thumbtack addresses how skilled professionals are redefining work and changing the face of the American middle class, and what we need to do to help them succeed.”
The report draws on Thumbtack’s proprietary data from tens of thousands of small businesses, as well as the latest economic data, labor statistics and forecasts. Thumbtack features more than 200,000 “skilled professionals” – individuals who use their vocational skills and passion to build long term, self-sustaining careers – that generated more than $1 billion in business last year across all 50 states. Skilled professionals include everything from carpenters and electricians, to tutors, to personal chefs and massage therapists.
Key takeaways from the report include:
- The low-skilled gig economy job is unsustainable, but skilled professionals have skills that have the advantage of being difficult to outsource and resistant to automation.
- It is easier and cheaper than ever for skilled professionals to take part in the gig economy. Technology solutions like Thumbtack and new laws like the Affordable Care Act have removed obstacles that previously prevented many people from starting their own businesses.
- Skilled professionals report higher job satisfaction. 84% of skilled professionals surveyed “love what they do”, versus a Gallup survey of the general working population found that only 29% of Americans said they were “engaged” at work.
- Skilled professionals can earn higher pay. Because they are operating under their own brands, and negotiating their own prices, skilled professionals can work for rates that work for them. Skilled professionals without a college education report gross revenues for their business that are up to $20,000 higher than the median income of other similarly educated workers. Because they are working full time, they tend to earn more than the part-time income of their low-skilled gig economy counterparts.
- Skilled professionals overall have better job opportunities. While the commodity-focused gig economy exists primarily in major metropolitan areas, skilled professional marketplaces are growing and thriving in every pocket of the country. Moreover, online professional marketplaces such as Thumbtack allow skilled professionals to grow their business more than before (on average 20% more), by connecting them to customers and assisting them with marketing services.
- Skilled professionals are career-focused, not “gig” focused. Two-thirds of skilled professional respondents revealed they are using technology-powered marketplaces to build and grow their primary business (vs. people who are doing this work to earn extra pocket money).
“The skilled professional is the real future of the gig economy and is a sharp contrast from the low-skilled ‘gigs’ that currently receive so much media attention,” continued Mr. Zappacosta. “It is important that policy makers, tech companies, and workers come together in support of this growing class of small businesses and individual entrepreneurs.”
The Thumbtack report concludes with specific policy recommendations to support the skilled professionals, including minimizing regulatory barriers and complex tax policies, strengthening the social safety net, and creating more opportunities and incentives for vocational training. The full report is available via Thumbtack Journal.
Thumbtack is an online service that connects consumers with skilled professionals to get things done. More than 200,000 professionals, ranging from handymen and housekeepers, to tutors, photographers, wedding planners and more, use Thumbtack to connect with millions of customers, collectively generating more than $1 billion in annual business across all 50 states. Founded in 2009 and headquartered in San Francisco, Thumbtack is backed by Sequoia Capital, Tiger Global Management, Javelin Investment Partners, Baillie Gifford, and Google Capital.
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