How The On-Demand Economy is Reshaping the 40 Hour Work Week

Secretary of Labor Tom Perez announced this week that the Bureau of Labor Statistics is bringing back the Contingent Worker Supplement. This means that for the first time since 2005, we will benefit from “reliable, credible insight into what’s going on across a range of work arrangements – from independent contractors to temporary employees to workers holding multiple jobs at the same time.”

This is welcome news indeed. Much of the debate that has been raging about worker classification has taken place without the benefit of objective data or any sophisticated analysis of on-demand workers themselves.

The lack of data has been particularly challenging because the on-demand economy has upended fundamental assumptions we have about the way we should work.

Take the 40 hour week, for example. New data from a study my team at Intuit prepared shows that the 40 hour work week is alive and well, but for the growing ranks of people dipping a toe in the on-demand economy, it looks nothing like it does to those of us working a traditional job.

The data shows that the average person in the on-demand economy works 40.4 hours per week, but relies on three different sources of income for their paycheck. On average, on-demand work represents 34 percent of income, while other sources include: a traditional full or part-time job (30 percent), contracting and consulting (19 percent), and running a business (14 percent).

Our study was prepared in partnership with Emergent Research and eleven on-demand economy and online talent marketplace companies. We undertook this project because we wanted to gain a deeper understanding of the aspirations, motivations and pain points of those choosing on-demand jobs. Who are they? Why did they choose this work? How satisfied are they? What are their pain points?

To be blunt, the results of the research provide a counter narrative to the worker classification debate.

For example, we found virtually no evidence of people looking for so-called “traditional employment.” Instead of a plea for a more predictable, fixed, schedule, we found that 91% like the fact that the on-demand economy gives them control over where, when and how they work.

Digging deeper, we looked at the reasons people choose to work on-demand jobs. In short, it is not to replace a traditional job, but rather to earn supplemental income:

• 63% say their primary motivation is to earn supplemental income.
• 46% say their primary motivation is to create and control their own schedule.
• Only 11% reported turning to on-demand work because of an inability to find a job.

The data also shows that there is a strong entrepreneurial drive behind people choosing on-demand work. In fact, a significant portion of people working on-demand jobs are actively running a business, or planning to build one:

• 39% report owning their own full or part-time small business
• 24% report working in the on-demand economy in order to build a business.

Finally, and perhaps most importantly, our data also shows that there is high satisfaction with on-demand work, precisely because it fits a unique need.

• 70% of on-demand workers are satisfied with their work.
• 81% plan to continue working with their primary on-demand economy partner over the next year.
• 63% say they are happier because they are working with an on-demand economy partner.

In my mind, this data shows that people working on-demand jobs are looking forward, embracing new opportunities, and taking charge of their careers. They are showing us what the future of work and entrepreneurship looks like.

The on-demand economy is the latest iteration of thirty year rise in self-employment. Full and part-time contingent workers represented 17 percent of the U.S. workforce 25 years ago, have reached 36 percent today, and are expected to grow to 43 percent by 2020.

At Intuit, we believe the on-demand economy provides positive opportunities for this rapidly growing segment of the workforce. But we also recognize that it comes with the shadow of limited benefits and inferior infrastructure. That’s why we’re dedicated to creating new tools, like our QuickBooks Self-Employed product, that allow this emerging workforce to build financial stability.

We believe that objective data is one of the keys to making informed decisions about how best to build new tools and supports that meet the needs of on-demand workers. That’s why the announcement from the Department of Labor is so important.

We believe that this is an opportunity to pivot the debate about the on-demand economy in a more constructive direction. Let’s use this as an opportunity to roll up our sleeves, think through the tough issues and forge ahead with new solutions that deliver certainty and stability for people working in the on-demand economy.  

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