Report

Gig Economy in Canada – Rose from 5.5% to 8.2% between 2005 to 2016, with low annual income

The gig economy is a much-discussed global phenomenon, and mainstream and social media continue to speculate about the number of gig workers in Canada. Gig workers are usually not employed on a long-term basis by a single firm; instead, they enter into various contracts with firms or individuals (task requesters) to complete a specific task or to work for a specific period of time for which they are paid a negotiated sum. This includes independent contractors or freelancers with particular qualifications and on-demand workers hired for jobs mediated through the growing number of online platforms.

This study introduces a clearly defined methodological framework for identifying gig workers in Canada based on various Canadian administrative sources, including individual and corporate income tax returns. This is the first Canadian study to systematically identify gig workers using administrative data and measure the share of gig workers among all Canadian workers. When the work arrangement typology developed in previous studies is applied, gig workers can be viewed as unincorporated self-employed workers (sole proprietors) who report business, professional or commission self-employment income, and whose future business activity is uncertain or expected to be minor or occasional.

This study found that, from 2005 to 2016, the percentage of gig workers in Canada generally rose from 5.5% to 8.2%. The increase was observed for both men (from 4.8% in 2005 to 7.2% in 2016) and women (from 6.2% in 2005 to 9.1% in 2016), and driven by the growth in the percentage both of gig workers who earned no wages or salaries (T4 income) and of gig workers who combined gig work with wages or salaries.

The results showed that the annual income of a typical gig worker was usually low. The median net gig income in 2016 was only $4,303. Workers in the bottom 40% of the annual income distribution were about twice as likely to be involved in gig work as other workers.

For most gig workers, gig work was only a temporary activity. Roughly one-half of those who entered gig work in a given year had no gig income the next year. However, a non-negligible share of gig work entrants—about one-quarter—remained gig workers for three or more years.

Workers whose main occupations were in arts, entertainment and recreation were about four times more likely to be gig workers than workers whose main occupations were in management of companies and enterprises. Those whose main occupations were in manufacturing and utilities were least likely to be gig workers.

The study also found that gig work was more prevalent among immigrants than among Canadian-born people. In fact, 10.8% of male immigrant workers who had been in Canada for less than five years were gig workers in 2016, compared with 6.1% of male Canadian-born workers.

Chosen excerpts by Job Market Monitor. Read the whole story at  Measuring the Gig Economy in Canada Using Administrative Data

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