The United States Census Bureau released a report on Thursday that sheds light on the rapid, far-reaching changes that Uber has provoked in the Transit and Ground Passenger Transportation subsector of the economy. The report reveals that nonemployer businesses increased by a remarkable 59.4 percent in 2015, a development caused in part by the popularly-termed “Uber Effect.”
Uber is called a “nonemployer business” because its drivers are independent contractors as opposed to employees, meaning that they set their own hours and don’t receive most employee benefits. Uber is only a middle man between self-employed contractors (drivers) and customers (passengers), as opposed to an employer, though this distinction has been controversial for a company that has often been accused of treating drivers unfairly.
Uber is one of the biggest — if not the largest — nonemployer businesses in the transit industry, and because the company paved the way for similar ride-hailing businesses like Lyft and Gett, it’s credited with helping to incite the recent flood of independent contractor businesses that together make up the “gig economy.”
In other words, this new data from the Census Bureau, which shows just how enormously the gig economy has surged in this subsector of the economy, also tells the story of Uber’s rise (corroborated by the fact that, in 2015, Uber experienced its steepest growth up until that point). Needless to say, 59.4 percent is a massive increase.
The census data also shows that the states with the largest number of nonemployer establishments are California, New York, and Illinois, i.e. the states with the country’s three biggest cities: New York City, Los Angeles, and Chicago.
The states (or equivalent) that had the highest increase in the number of nonemployer establishments were the District of Columbia (54.1 percent), Rhode Island (43.7 percent), and Maryland (39.9 percent).
The report also notes that the number of nonemployer receipts across all sectors of the economy increased 2.9 percent to total $1.1 trillion. In 2015, then, the gig economy was already a marketplace with 13 figures of circulating capital.
The “Uber Effect” has swept across America for years — very powerfully, as this census report demonstrates — and it will continue to do so, even if Uber itself gets boycotted into oblivion.