Contingent Employment Arrangements: The Implications of the Bureau of Labor Statistics’ Survey

The Bureau of Labor Statistics (BLS) released the Contingent and Alternative Employment Arrangements survey on June 7, 2018. The BLS survey represents the first large-scale survey of its kind since 2005. The survey found that 16.5 million workers participate in “contingent” or “alternative work” arrangements, with almost 6 million workers working on a contingent basis and an additional 10.6 million working as independent contractors, on-call workers, temporary help agency workers and those working for contract firms.

Survey highlights include:

• Contingent workers were more than twice as likely as non-contingent workers to be under age 25. They were also more than twice as likely as non-contingent workers to work part-time.
• Young contingent workers (16- to 24-year-olds) were much more likely than their non-contingent counterparts to be enrolled in school (62 percent and 36 percent, respectively).
• Contingent workers were more likely to work in professional and related occupations and in construction and extraction occupations than non-contingent workers.
• More than half of contingent workers (55 percent) would have preferred a permanent job.
• While 79 percent of independent contractors preferred their arrangement over a traditional job, only 44 percent of on-call workers and 39 percent of temporary help agency workers preferred their work arrangement.

Key Takeaways

Percentage of Contingent and Alternative Workers Has Slightly Decreased

The survey found that as a percentage of all workers, those in alternative employment arrangements—including contract, freelance and on-call work—was lower in 2017 (10.1 percent) than in 2005 (10.7 percent). This category of independent contractors includes those participating in the “gig economy” as their primary job. Before the BLS survey was released, some experts anticipated an increase in the percentage of alternative and contingent workers from 2005. At its broadest measure, the percentage of contingent workers fell from 4.1 percent to 3.8 percent. The number of both contingent and non-traditional workers grew, but at a lower rate than the overall workforce.

Traditional Work Arrangements Still Dominant as Primary Jobs

Most Americans still work in traditional arrangements for their primary job. “What this says to me is the vast majority of workers in the United States still have traditional jobs as their main source of income,” said Heidi Shierholz, a former chief economist at the Labor Department.

What’s Missing?

Some experts do not believe the BLS survey data paints the whole contingent labor picture. For example, the survey only concentrates on workers whose primary job or modes of employment are contingent roles. Research conducted by the Federal Reserve suggests that a large percentage of those in alternative work arrangements and contingent work are doing it as a side job, rather than as their main occupation. For example, 69 percent of Uber drivers are not considered in the BLS study because they also have full-time jobs.

Moreover, the data collected by the BLS only counts work done in the week prior to the survey. As a result, many workers who sometimes work on a contingent basis, but have not done so recently, may have been missed. Additionally, data about digital platform work and the gig economy is still being analyzed and will not be available until the fall. These workers may be overlooked because the BLS data is gathered from self-reported information about employment and does not incorporate data from gig economy giants like Uber, Lyft and Airbnb.

Capitalizing on Contingent Employment Trends

The BLS survey reports the total number of contingency-based jobs grew from 14,826,000 in 2005 to 15,482,000 in 2017, a gain of 656,000 jobs or by 4.6 percent over twelve years. What’s more, the total number of workers in permanent positions grew by 14,379,000 or by 10.4 percent. Organizations need to realize the workforce is becoming more blended, and to effectively attract talent, they may need a hybridized recruiting strategy.

A Total Workforce Solution is an integrated talent management program that combines elements of RPO and MSP programs to create a total workforce solution designed to help organizations meet it permeant and contingent labor needs. Check out PeopleScout’s Total Workforce Solutions fact sheet to learn more.