--- title: The Reality of Freelance Economy description: The freelance economy is troubling given the unbending and unforgiving realities of today’s economic environment canonical: https://time.com/3903267/freelance-economy-reality/ author: New America article:opinion: true article:content_tier: free article:published_time: 2015-06-03T19:24:33.000Z article:modified_time: 2026-02-22T07:47:15.964Z article:section: Ideas og:title: Who Is the Freelance Economy Hurting? og:description: The freelance economy is troubling given the unbending and unforgiving realities of today’s economic environment og:url: https://time.com/3903267/freelance-economy-reality/ og:site_name: TIME og:image: https://static.time.com/v3/assets/bltea6093859af6183b/bltfb757459285bbc52/698852713c1639275f458244/464675083-copy.jpg?branch=production&width=414&quality=75&auto=webp&crop=16:9 og:image:width: 414 og:image:height: 233 og:image:alt: car-piggy-bank-driving og:type: article twitter:card: summary_large_image twitter:title: Who Is the Freelance Economy Hurting? twitter:description: The freelance economy is troubling given the unbending and unforgiving realities of today’s economic environment twitter:image: https://static.time.com/v3/assets/bltea6093859af6183b/bltfb757459285bbc52/698852713c1639275f458244/464675083-copy.jpg?branch=production&width=414&quality=75&auto=webp&crop=16:9 ---  # Who Is the Freelance Economy Hurting? > Sponsored content. 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It explains how TIME's journalism is made, from the first pitch through the editorial decisions behind a finished story or cover. #### How can I read about how TIME chooses its covers? Inside TIME is the newsletter where TIME's Editor-in-Chief explains cover selection and the editorial reasoning behind major stories. It is free at time.com/newsletters. #### Who is the editor of TIME? Sam Jacobs is TIME's Editor-in-Chief. He writes Inside TIME, a twice-weekly newsletter about the newsroom's reporting and editorial decisions. #### Is Inside TIME free? Yes. Inside TIME is a free newsletter, available at time.com/newsletters. A paid TIME subscription is separate and available at time.com/subscribe-agent. ## Video: Uber Takes its Delivery Service to NYC, In 10 Min or Less [Watch (HLS stream): Uber Takes its Delivery Service to NYC, In 10 Min or Less](https://cdn.jwplayer.com/manifests/v3LqlxOj.m3u8) (2:03)  _Published 2015-04-28. UberFresh was the original name for Uber's delivery service, and it's been in operation since August 2014 in places like Los Angeles and Barcelona._ by [Charles D. Ellison / New America](https://time.com/author/new-america-foundation/) ## Charles D. Ellison / New America Jun 3, 2015 7:24 PM UTC  Pacific Islander driving car with piggy bank on top Pacific Islander driving car with piggy bank on top Getty Images by [Charles D. Ellison / New America](https://time.com/author/new-america-foundation/) ## Charles D. Ellison / New America Jun 3, 2015 7:24 PM UTC These days, it’s all about the freelance economy—or what many experts envision as the new economic normal. As the economy makes its bland recovery, flexible (no-benefits and low-cost) freelance (a.k.a. “shared,” a.ka. “contingency”) work is all the rage. But who benefits from this supposed freelance boom? This growth of contract employees, such as the ride-sharing and taxi-obliterating Uber, along with its competitor and policy partner-in-sector Lyft, has already sparked some good old-fashioned turf wars over innovation. And while the fever-pitched combat between traditional taxis and ride-share services might seem like just another nose-breaking scrap between rivals in a market space, there’s even more to it than that. The outcome promises to radically and forever reshape what it means to be a worker. The Freelancers Union excitedly sneezed out its “National [Survey](https://www.freelancersunion.org/blog/dispatches/2014/09/04/53million/) of the New Workforce” last September, boasting about the 53 million workers disrupting the typical economic model. Gone are the days when like Ward Cleaver strolls through the front door after a 9-to-5 white collar grind. First add June to that equation—she’s working, too, while the Beav and Wally are left latch-keyed to their own smartphone-fueled devices because their parents’ freelance work comes without the benefit of regular hours. The generational impact of the “freelance revolution” doesn’t stop at the nuclear family—imagine Millennials hunched over laptops in the local Starbucks or overwhelmed Gen-X’ing parents hustling for both paycheck and flexibility. Let the numbers tell it, and it’s all good—advantage innovators. Popular freelance economy pioneers like Uber [enjoy](http://www.bloomberg.com/news/articles/2014-12-04/uber-valued-at-40-billion-with-1-2-billion-equity-fundraising) eye-popping valuations of $40 billion or more, thereby validating an emerging freelance ideology. Freelancers, according to the Freelance Union, are also contributing more than $700 billion of productivity to our $14 trillion economy, which is solid and respectable. As the economy rapidly reconfigures and technology pushes us further into automation, the segment of the workforce that’s contracted will also rise from today’s 34 percent to an astonishing 50 percent [by 2020](http://www.forbes.com/sites/waldleventhal/2014/11/24/5-predictions-for-the-freelance-economy-in-2015/). Hence, the trend shows no sign of reversing, but rather more signs of metastasizing. It’s reasonable to assume that, in our collective lifetimes, freelance or contractual work will be the fundamental core of our global labor market. There will be way more freelancers than full-time permanents. A world of full-timers and full-time-nots looms just over the horizon—and for some workers, it’s already here. Not only does that make the Affordable Care Act convenient in terms of its timing, but also rather prescient. Permanent non-freelance jobs won’t be an economic staple in 10 years. Instead, they’ll be something of a highly-prized and rather rare privilege. From a white-collar perspective, freelancing seems like an efficient fit. Philosophically, it appears to thrive off the notion of high-octane entrepreneurship, an attractive social construct where we control our own agency. But the freelance economy is troubling given the unbending and unforgiving realities of today’s economic environment. Among traditionally underserved populations, who face income inequality, stagnant wages, and underemployment, disrupting tech enthusiasts prompt more anxious questions than giddy answers. A ballooning freelance workforce means a permanent state of non-permanent wages, adding more uncertainty to an economic environment saddled by [stuck income](http://www.pewresearch.org/fact-tank/2014/10/09/for-most-workers-real-wages-have-barely-budged-for-decades/). As Pew found recently, “the average wage peaked more than 40 years ago: The $4.03-an-hour rate recorded in January 1973 has the same purchasing power as $22.41 would today.” While poverty is at 15 percent, economic inequality in the United States is obscene, a place where the [top 20 percent](http://www.scientificamerican.com/article/economic-inequality-it-s-far-worse-than-you-think/) own 84 percent of … well … everything. Anecdotally and statistically, we see persistent public anxiety about the economy. A [POLITICO poll](http://www.politico.com/story/2014/10/economic-anxiety-2014-elections-112122%5FPage3.html#ixzz3GyqUrBXF) discovered 64 percent of respondents feeling as if the country was “out of control” and only 36 percent believing it’s in a “good position to meet its economic and national security challenges.” When a subsequent [POLITICO story](http://www.politico.com/story/2014/10/economic-anxiety-2014-elections-112122.html) highlighting economic concerns as a central issue in the upcoming elections dropped, it was peppered with quotes from average voters expressing “raw” concerns about matters such as “outsourcing” and “job growth.” The question of who benefits becomes more pressing with each passing year the freelance economy grows. Interestingly enough, the decline of purchasing power since 1973 seems to mirror the upward trend of the “contingent” economy during that same period. And, along with the recession, it also means—eventually—that large segments of the population are getting left behind or will remain behind. Already, as Prospect’s Virginia Durivage pointed [out](http://prospect.org/article/flexibility-trap-proliferation-marginal-jobs) some time ago, “most contingent workers are women and minorities clustered in low-wage jobs with no benefits or opportunities for advancement.” Official unemployment rates released each month by the Bureau of Labor Statistics make recovery feel as fresh as a detergent commercial, but these reports slickly ignore other indicators such as underemployment or diminished labor force participation rates that actually show joblessness is much [higher](http://www.shadowstats.com/alternate%5Fdata/unemployment-charts) than we think. One factor, perhaps, could be a rising freelance mindset as fed-up workers tap out of traditional models in a bid to make it on their own. Another obvious factor is a society still largely discriminating on the basis of race and perceived status, a condition for which the freelance economy may have no solution – especially if, as USA Today showed in a recent [analysis](http://www.usatoday.com/story/tech/2014/10/12/silicon-valley-diversity-tech-hiring-computer-science-graduates-african-american-hispanic/14684211/), “top universities turn out black and Hispanic computer science and computer engineering graduates at twice the rate that leading technology companies hire them.” Would embracing a dominant freelance economy make that situation worse? It’s unclear at the moment. What we can see, for example, is that freelance pioneers like Uber are disrupting taxi industries largely populated by drivers of color: while 32 percent of tax drivers are black, less than 20 percent of Uber drivers are the same compared to more than 40 percent who are white. Asian and Latino Uber driver rates are, however, nearly identical to their proportions as taxi drivers, even while still low (17 percent each, respectively) when compared to white Uber drivers. That probably doesn’t hint at any pattern of hiring discrimination on that part of Uber when it clears and selects contracted drivers. But, what is clear is that companies reliant on outsourcing as their primary operational model have more incentive to circumvent (or altogether neglect) worker rights than when industries were more reliant on permanent positions. _Charles D. Ellison is a veteran political strategist and Contributing Editor for_ The Root_._ _This piece was originally published in New America’s digital magazine,_ [_The Weekly Wonk_](http://weeklywonk.newamerica.org/)_._ _Sign up to get it delivered to your inbox each Thursday_ [_here_](http://weeklywonk.newamerica.net/subscribe-email/)_, and_ [_follow @New America_](https://twitter.com/NewAmerica) _on Twitter._ ## Transcript GrubHub. Click, click, food. As if there weren't enough food delivery services in New York City, ride hailing service Uber is moving in on GrubHub's, Seamless, and InstaCart's territory with good delivery in the big apple. Uber eats. From tap to table in minutes Ten minutes, to be exact. At least, that's what Uber promising. In a city with 8. 4 million people and notoriously busy streets, Uber says it get you your food in that amount of time or less. Now, before you discount Uber's claim some caveats For one, Uber has done this before, in the one American City where traffic is even worse: Los Angeles. UberFresh was the original name for Uber's delivery service, and it's been in operation since August of 2014. After starting in Santa Monica, Uber now also serves Beverly Hills, West Side L. A ., and some parts of Hollywood. And you guessed it. The ten minute or less promise is still on the table. Uber Eats is just like Uber X. Instead of picking up customers, we deliver their lunch or dinner. So, the secret recipe behind Uber Eats, how about a limited menu? Couple that with the fact that drivers already have food on board, and we're suddenly looking at some pretty efficient meals on wheels. Wired says this select menu is what allows Uber to keep it's ten minute guarantee in such large cities. Rather than waiting for customers to place an order, waiting for the restaurant to make the order and then battling traffic to deliver the order. Uber drivers pick up batches of orders, then they drive around as they always do waiting to make a delivery. Also Uber's bite out of a big apple is a relatively small one. Instead of taking on the whole city at once, it will start by only serving the Manhattan area between 40th and 14th streets. Along with constantly expanding it's pseudo taxi service, Uber has consistently pursued businesses outside it's core service. In just the past two years, the San Francisco based company has launched a food delivery business Convenience store on wheels, bike messenger delivery service, and last, but not least, a human size Breathalyzer. ```json [{"@context":"https://schema.org","@type":"OpinionNewsArticle","@id":"https://time.com/3903267/freelance-economy-reality/","mainEntityOfPage":{"@type":"WebPage","@id":"https://time.com/3903267/freelance-economy-reality/"},"headline":"Who Is the Freelance Economy Hurting?","datePublished":"2015-06-03T19:24:33.000Z","dateModified":"2026-02-22T07:47:15.964Z","description":"The freelance economy is troubling given the unbending and unforgiving realities of today’s economic environment","url":"https://time.com/3903267/freelance-economy-reality/","keywords":["society","Economy","Money","Uber"],"thumbnailUrl":"https://static.time.com/v3/assets/bltea6093859af6183b/bltfb757459285bbc52/698852713c1639275f458244/464675083-copy.jpg?branch=production&width=1200&quality=75&auto=webp&crop=1200:675&height=675","author":[{"@type":"Person","name":"Charles D. 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