Report: Discrepancy Between Growing Freelance ‘Phenomena’ and US Unemployment Figures

unemployment rate chart

From Business 2 Community, Jennifer Neeley raises the question of whether the US Bureau of Labor statistics is accurately reporting unemployment in the United States and whether its statistics include freelancers.  Jennifer writes:

The U.S. Bureau of Labor Statistics’ released their jobs report for May which tracked the US unemployment rate at 5.4%. According to Susan Houseman, Senior Economist at the Upjohn Institute for Employment, the percentage of American workers that identified as ‘self-employed’ in the Current Population Survey (‘CPS’) has remained steady between 10 and 11%.

Yet according to a 2014 report commissioned by non-profit group Freelancers Union, 34% of the population (roughly 53 million Americans) work on a freelance basis. This raises questions about whether national freelancer data is being accurately tracked to exclude wider implications about the US unemployment numbers.

While taking into account freelancers who identify as full-time workers, the disparity in numbers still suggests there exists an apparent discrepancy between the Bureau of Labor Statistics’ unemployment figures and the recent data released by Freelancers Union.

We approached the press officer for the BLS, Gary Steinberg, who informed us: “There is no category called freelancers in our survey because it’s not an occupation and it’s not an industry. But our survey [Current Employment Statistics] does include every job that’s on a payroll.”

Steinberg admitted, however, that most self-employed workers, more often than not, are not on a payroll. In which case, they will be included in the “household,” or Current Population Survey, he said. This is where it can get tricky. The CPS asks respondents about the job they held in a specific week of the survey month. Freelancers, however, can work anywhere from zero hours to much above average hours in any given week, adding a loophole to the final jobs report.

Read the full story at Report: Discrepancy Between Growing Freelance ‘Phenomena’ and US Unemployment Figures.

Perhaps part of the discrepancy can be explained by the definition of freelancers that the Freelancers Union report uses.  The Freelancers Union’s report defines a freelancer as “individuals who have engaged in supplemental, temporary, or project- or contract-based work in the past 12  months.”  This includes individuals who moonlight, people with multiple sources of income, temporary employees, and small business owners (1 to 5 employees).  A full-time employee who freelances to supplement his/her income might not appear on the Bureau of Labor Statistics report as self-employed but might be included in the Freelancers Union’s definition of freelancer.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.