Wednesday, July 1, 2015

Moonlighting on the Rise or the First Signs of a Dramatic Change in the Nature of Work?

Justin Fox at Bloomberg has done some interesting number crunching, which suggests a climb in people moonlighting. He writes:

The Census Bureau's "nonemployer businesses" are sole proprietorships, partnerships or corporations that have no employees but report $1,000 or more in annual receipts -- unless they're in construction, in which case the cutoff is $1. In the chart below I also include the BLS data series on self-employment, which is derived from the Current Population Survey and only goes back to 2000 because that's when the government started keeping track of the incorporated self-employed along with the unincorporated self-employed. If every nonemployer business were a full-time job, the two lines would presumably overlap. They don't -- so the gap roughly represents people who are getting business income on the side.
Given how different the data sources are (tax returns versus a survey), this is only a rough approximation. But the gap is definitely growing. Also, the Census Bureau actually tightened its screens for identifying nonemployer businesses starting in 2009, meaning that the gap has probably been growing even faster than the chart shows.

In 2013, there were about 8 million more nonemployer businesses than people reporting that they were self-employed. This is a lot of people.

Fox then advances this theory:
[I]t may well be that we are on the cusp of dramatic change in the nature of work as technology destroys jobs and possibly enables new kinds of independent and semi-independent work. There are certainly a lot of people in Silicon Valley and elsewhere betting on this. We just haven't gotten there yet.

1 comment:

  1. I don't think it's technology that is destroying these job opportunities and creating this shift to independent and semi-independent work. I think government regulatory policy, minimum wage laws, and the threat of being sued for basically anything are the key drivers.

    For starters, regulations and minimum wage laws have destroyed the job opportunities to the point where your only option is to become self-employed in order to find a job. And secondly, once you are a self-employed individual, it's simply too dangerous to hire somebody due to the insane legal and regulatory environment that you have to try to operate in.