Gig Economy Explained: Wage Theft, California's AB5 and India's Social Code

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The gig economy is now described as a $1 trillion sector of the U.S. economy, yet measuring it is surprisingly hard. Economists Lawrence Katz and Alan Krueger found a 50 percent rise in gig workers, freelancers and contractors between 2005 and 2015, accounting for 94 percent of U.S. employment growth in that decade. The Harvard Business Review counted 150 million gig workers across North America and Western Europe in 2018, while the Bureau of Labor Statistics put electronically mediated work at just 1.0 percent of employment and the Government Accountability Office gave a range from under 5 percent to over a third of the workforce. The episode argues platforms shift the financial risk of work from employers onto individuals.

That risk falls unevenly. A 2022 survey of New York freelancers found 62 percent had experienced wage theft and 53 percent reported losses of up to $10,000, and Pew data from 2021 shows 16 percent of U.S. adults have earned gig income, with participation highest among Hispanic Americans at 30 percent. India's gig workforce of about 7.7 million in 2020 to 2021 is projected to reach 23.5 million by 2029 to 2030, boosted when COVID-19 lockdowns sent young workers back to smaller towns. Regulators have split: California's AB5 presumes workers are employees, while India's 2020 Code on Social Security created a separate legal category for gig workers.

• In the casino analogy, the platform is the house that takes a cut of every pot regardless of who is playing.
• Black Americans participate at 20 percent, Asian Americans at 19 percent and white Americans at 12 percent, according to Pew.
• Indian platforms like PickMyWork use gig workers as on-the-ground sales agents signing up merchants for banks and apps.
• India's code requires platforms to pay 1 to 2 percent of annual turnover into a social security fund for gig workers.
• India's 2025 to 2026 budget pushed registration drives and identity cards so benefits follow workers across apps.