Independent work: choice, necessity, and the gig economy


As countries become wealthier, traditional employment becomes the norm



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As countries become wealthier, traditional employment becomes the norm
SOURCE: ILOSTAT; World Bank; McKinsey Global Institute analysis
20,000
15,000
45,000
5,000
0
10,000
50,000
40,000
25,000 30,000 35,000
90
70
80
40
20
65,000
60,000
55,000
60
50
30
100
Traditional employment
1
% of total employment
GDP per capita, purchasing power parity
Current international $
1 We define traditional employment as what the ILO calls “stable employment,” including all employment outside of own-account self-employment or 
contributing family workers.
Greece
Thailand
Colombia
Bolivia
Italy
United Kingdom
Germany
Spain
Brazil
Poland
Singapore


27
McKinsey Global Institute
Independent work: Choice, necessity, and the gig economy
Government data suggest that roughly 10 to 15 percent of working-age people 
earn their primary income through independent work
We begin our analysis by examining government data on various employment 
arrangements. However, the official statistics have some important limitations. One of the 
biggest gaps is the fact that government labor market surveys ask respondents about their 
primary occupations—so by definition, they ignore activities that generate supplemental 
income. (For more on these data issues, see Box 2, “Data difficulties in measuring 
independent work.”) 
Despite its limitations, government data do offer an initial view into the prevalence of 
independent work in the United States and Europe. The self-employed and temporary 
worker categories most closely match our definition. Using US Bureau of Labor Statistics 
(BLS) data on self-employment and Katz and Krueger’s survey of other alternative work 
arrangements (which replicated the government’s Contingent Work Supplement survey), 
we find that 11 percent of the US working-age population makes their primary living from 
self-employment, temporary work, or contract work.
25
 In Europe, 14 percent of the working-
age population in the EU-15 countries are self-employed or temporary workers (Exhibit 4). 
Together, these two categories account for 10 to 15 percent of working-age adults in the 
United States and in most European countries.
But the figures vary somewhat across countries, from 11 percent in the United States to 
18 percent in Spain. In general, the highest shares of independent workers are found in 
countries such as Greece, Italy, Poland, and Spain where incomes are lower and economic 
growth has been persistently weak. In these countries, some 15 to 20 percent of the 
workforce is self-employed or in temporary employment. In some European countries, 
including Greece, Spain, Portugal, the Netherlands, and Poland, more than three-quarters 
of temporary workers are involuntary.
25
  See Lawrence Katz and Alan Krueger, 
The rise and nature of alternative work arrangements in the United 
States, 1995–2015
, March 2016.
Independent work may not be a new phenomenon, 
but it has never found a comfortable fit within official 
government data.

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