JPMorgan: 1% of American adults earn "gig economy” income

A new report from JPMorgan Chase entitled Paychecks, Paydays, and the Online Platform Economy, nearly 1% of American adults (2.5 million people) earned income via the on-demand, or “gig” economy in September 2015. The report also found that the on demand economy is growing quickly, with the number of Americans involved in on–demand work increasing tenfold since 2012, although the vast majority use it for a part-time, secondary, source of income.

JP Morgan Chase Research Institute's study Paychecks, Paydays, and the Online Platform Economy uses a random sample of 1 million bank accounts to analyze workers participation in the on-demand economy.

According to the study, nearly 1% of U.S. adults earned income in September 2015 via one of the growing number of firms that are part of the sharing, gig or on-demand economy.

This works out to about 2.5 million Americans.

Regular readers will likely notice this is close to our estimate of 3.2 million, which we developed in partnership with Intuit and released last August.

Our number is higher because JP Morgan Chase looked at just one month's activity while our survey asked respondents about recent activity.

Given that many people pop-in and pop-out of on-demand economy work, it's not surprising data from one month would be a bit lower than data spanning several months.

JP Morgan Chase also found while small, the on-demand economy is growing very rapidly.

As the chart below - which is taken from the Wall Street Journal's excellent summary of the study - shows, the number of Americans working in the on-demand economy has increased almost 10 fold since 2012.

The study also found the vast majority of on-demand economy jobs are part-time. Key quote from the study:

In the months when individuals were actively participating, platform earnings represented a sizable but still secondary source of income. Average monthly earnings in participation months was $533 for labor platforms, representing 33 percent of total monthly income, and $314 for capital platforms, representing 20 percent of total monthly income

This is inline with our research on on-demand economy jobs (see Most Workers in the On-Demand Economy Are Looking for Highly Flexible Part-Time Work for more details).

This study adds to a growing body of research showing that most workers in the on-demand economy are looking for highly flexible part-time work.

It also echos our view that the on-demand economy is creating an important new source of work. Key quote from the report:

The Online Platform Economy also adds an important new element to existing labor markets, where finding new or additional work typically involves a lot of effort and high transaction costs. Simply put, landing a platform job is often easier and quicker. Likewise, individuals can, and do, generate additional income on labor platforms in a timely fashion when they experience a dip in regular earnings. This is a potentially far better option to mitigate or weather volatility if the alternatives are to constrain spending, to take on additional (potentially high-cost) credit, or to become delinquent on existing loans.

For another analysis of these studies, see Bloomberg View's Your Uber Driver Probably Has Another Job.