The "Missing Self-Employed": How Better Data Change the Picture of Self-Employment in the United States

Authors

• Katharine G. Abraham, University of MarylandFollow
• Susan N. Houseman, W.E. Upjohn Institute for Employment ResearchFollow
• Beth C. Truesdale, W.E. Upjohn Institute for Employment ResearchFollow

Upjohn Author ORCID Identifier

https://orcid.org/0000-0003-2657-8479

https://orcid.org/0000-0002-3205-2847

Issue Date

May 2026

Abstract

How economically secure are self-employed workers? Accurate answers to this question depend on data that capture the full range of self-employed people, including business owners, independent contractors, and those working on an informal, often cash basis. Using data from the 2025 American Job Quality Study, we demonstrate that, because of the way standard survey questions are worded, a substantial number of self-employed people are likely miscoded as employees in existing surveys. Correctly including these “missing self-employed” increases the share of workers who are self-employed on their main job by nearly 50 percent. Compared to the self-employed captured by standard survey questions, the missing self-employed are more likely to be members of disadvantaged demographic groups, to work for only one or two clients, to work part-time, to have low tenure on their jobs, to report financial difficulty, and to have a second job to earn money. They are also substantially more likely than employees to have inadequate earnings. Our results show that the self-employed are more numerous and, on average, worse off economically than has previously been understood.

Series

Policy Paper No. 2026-039

DOI

10.17848/pol2026-039

Sponsorship

Jobs for the Future

Keywords

self-employment, independent contractors, informal work, economic measurement

Subject Areas

LABOR MARKET ISSUES; Employment relationships; Nonstandard work arrangements; Wages, health insurance and other benefits