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Independent Workers and Employment Surveys - 10/30/15

Based on surveys of employers, job growth in America has been disappointing recently.  Despite that, the nation’s unemployment rate, which is based on a survey of households, stands at just five point one percent.  Some economists believe that the survey of employers, or so-called establishment survey, is failing to fully count the jobs the economy is creating. 

As indicated by CNNMoney, the missing piece of the puzzle could be part-and full-time Uber and Lyft drivers, as well as housekeepers and others that comprise the on demand economy.  A study by MBO Partners and Emergent Research indicates that there are more than thirty million independent workers in the U.S.  The establishment survey may not be picking up many of these independents, and that could be resulting in an understatement of employment expansion. 

The number of independent workers has risen twelve percent over the past five years and by twenty twenty, the independent workforce could total nearly thirty eight million workers, or eight million people more than today.   Many of these workers are likely to report that they are working in the household survey, which keeps unemployment low even as the establishment survey fails to fully capture them.

Anirban Basu, Chariman Chief Executive Officer of Sage Policy Group (SPG), is one of the Mid-Atlantic region's leading economic consultants. Prior to founding SPG he was Chairman and CEO of Optimal Solutions Group, a company he co-founded and which continues to operate. Anirban has also served as Director of Applied Economics and Senior Economist for RESI, where he used his extensive knowledge of the Mid-Atlantic region to support numerous clients in their strategic decision-making processes. Clients have included the Maryland Department of Transportation, St. Paul Companies, Baltimore Symphony Orchestra Players Committee and the Martin O'Malley mayoral campaign.