The "Gig" Economy and Independent Contracting: Evidence from California Tax Data
Bernhardt, Annette,
Campos, Christopher,
Prohofsky, Allen,
Ramesh, Aparna,
and Rothstein, Jesse
Revise and Resubmit at ILRR
We use de-identified data from California personal income tax returns to measure the frequency and nature of independent contracting work in California. We identify independent contractors by the presence of a Schedule C on the tax return and/or the receipt of a Form 1099 information return. We estimate that 14.4% of California workers aged 18-64 in tax year 2016 had some independent contracting income; over half of these do not have traditional jobs generating W-2s and get all of their earnings from independent contracting. Workers with low earnings are significantly more likely to earn independent contracting income and to rely primarily or exclusively on that income. We explore the characteristics of independent contractors and their distribution across family type, geography, and industry.