The workers driving the AI revolution from the front lines

When you think of a gig worker, what image comes to mind? If your first thought is of an Uber driver, think again. In today’s reality, many gig workers are knowledge workers — those who typically work at a desk and whose jobs involve managing or using information. Moreover, knowledge workers are increasingly incorporating generative AI into their practices. The collision of technological innovation with the evolution of business models in the digital age is reshaping labor markets on every continent.

Globally, the market for self-employed workers has reached staggering proportions. According to the World Bank, in 2023, approximately 1.57 billion people in the global workforce were freelancers out of a total workforce of 3.63 billion. In the US, the number of freelancers currently stands at 73.3 million (according to Statista) and is projected to continue to grow to over 90.1 million by 2028 (according to Edelman Intelligence). Zooming in on Europe, where this transformation is encountering a fairly traditional labor market, recent data shows that more than 28.3 million people were working for digital labor platforms in the EU in 2022, a number that is expected to surge to 43 million by 2025. This rapid growth reflects the increasing prevalence of non-standard jobs, driven by digitization and emerging business models.

Highlight ✦ The “gig knowledge worker economy” is booming on both sides of the Atlantic. While the US leads with 73.3 million freelancers, Europe is catching up fast. The EU’s digital platform workforce is expected to leap from 28.3 million to 43 million workers between 2022 and 2025, signaling a rapid shift in its labor landscape.

Digital platforms, which use websites or apps to connect service providers with customers, are at the heart of this transformation. Knowledge and creative workers, including designers and ICT professionals, are increasingly using platforms such as Fiverr, Upwork, and 99designs, which have effectively transformed talent into a global, on-demand service.

In this context, generative AI and its technological advancements add another layer of complexity to the already diverse world of freelance and gig work. Let’s take a few examples. Imagine you need someone to quickly create an illustration for your online store. Now, instead of hiring a traditional illustrator, you can use a specialized “AI artist” portal, where artists list their fees for creating specific images created with Dall-E, Stable Diffusion, or Midjourney. Prices typically range from $15 to $60 per item. The same is true if you need someone to write blog posts that rank highly on Google. Instead of hiring a copywriter, you can hire Fiverr workers who offer large volumes of AI-generated text. For $90, one can buy 120 articles generated by GPT-3, with the assurance that they are free of plagiarism.

The growing interchangeability between independent workers and AI reveals a community of relatively unsung workers at the frontlines of automation and job innovation, a phenomenon that deserves further exploration. Let’s go back to the data. Of all platform workers in the EU, a staggering 93% (26.3 million) are currently classified as self-employed, and at least 12% are knowledge workers. However, this classification is a bit contested. There are concerns that around five million of these workers may be misclassified, potentially depriving them of basic employment rights and protections.

Highlight ✦ In the EU, 93% of platform workers are classified as self-employed, but there are concerns that around 5 million of these workers may be misclassified.

The Online Labour Observatory’s study of 11 gig work platforms found that while India, Pakistan, and Bangladesh were among the largest hubs for freelancers, their clients were predominantly in the US, Canada, Australia, and the UK. This global distribution of work is both enabled and complicated by digital platforms and AI technologies, allowing talented individuals from many parts of the world to compete on a global stage. However, it also raises concerns about fair compensation and potential exploitation.

The relationship between AI and the gig economy is complex and often paradoxical. Freelancers and contractors have unexpectedly found themselves thrust into the role of early adopters of AI, driven by a constant quest for efficiency, a need for optimization, and a natural affinity for digital learning. This early adoption has given them a unique edge, but it has also exposed them to the double-edged sword of AI’s impact on their livelihoods.

In January 2023, Fiverr reported a 1,400% increase in searches for AI-related job ads on its platform over the previous six months, indicating a surge in demand for AI-related skills. This data points to a significant shift in the freelance market, with AI-related services becoming increasingly valuable. However, this trend also raises concerns about the potential displacement of traditional freelance roles. A survey of more than 31,000 tech, finance, and media workers conducted by Rest of World found that 76% of respondents believe generative AI will allow their company to cut costs, and 63% predict that their company will hire fewer external contractors due to AI tools.

Yet, the story is far from simple. The same technological disruption that threatens some jobs is also creating new opportunities for those who can adapt. The emergence of new job categories such as content moderators, prompt engineers, and AI implementation consultants — albeit temporary and related to the actual context of AI development — demonstrates the potential for freelancers to carve out new niches in the AI-driven economy. These roles leverage human creativity and expertise to guide and refine AI outputs, creating a symbiotic relationship between human workers and AI tools.

Highlight ✦ While AI threatens traditional freelance work, it also creates new opportunities in areas such as prompt engineering, AI-assisted content creation, and AI implementation consulting.

Moreover, the development and refinement of AI systems themselves rely heavily on human labor. From data labeling to content moderation, an invisible army of workers plays a crucial role in shaping the technology that may one day replace them. This reliance on human input highlights a critical aspect of the AI revolution: the enduring need for human judgment, creativity, and ethical oversight in the development and application of AI technologies.

As the gig economy continues to evolve alongside AI technologies, key questions arise: How can we ensure that the benefits of AI are shared equitably among workers around the world? How can we balance the efficiency gains of AI with the need for meaningful, dignified work? And how can we create systems that enable workers to continuously upskill and adapt to rapidly changing technological landscapes?

Addressing these challenges will require a concerted effort by all stakeholders. The development of new education and training paradigms will be needed to help workers adapt to AI-driven work environments. It will also require careful consideration of labor policies and regulations to ensure fair treatment and compensation in a global marketplace increasingly influenced by AI.

Recognizing these challenges, the European Union has taken steps to address the unique needs of gig economy workers. In April 2024, the European Parliament voted in favor of the EU Platform Workers Directive, which aims to improve working conditions in the gig economy. The Directive seeks to correct misclassification of employment status, enhance transparency, and regulate the use of algorithms and data in decision-making processes affecting platform workers. Key provisions of the Directive include establishing national rules to presume an employment relationship when platforms exercise de facto control over workers, protections against algorithmic layoffs, and restrictions on processing certain types of personal data. The Directive also requires platforms to inform workers about how algorithms and automated systems are used in decisions affecting their conditions of employment.

Highlight ✦ The future impact of AI on freelance work will be shaped not just by technological capabilities but by the decisions of business leaders, policymakers, and workers themselves.

As we look to the future, it’s clear that the impact of AI on freelance work will be determined not just by technological capabilities but by human choices. The choices made by business leaders, policymakers, and workers themselves will shape how AI is integrated into the workforce. This point is underscored by instances where supposedly AI-driven systems have been found to rely heavily on human labor: remember Amazon’s “Just Walk Out” system? The one that was supposed to be all AI? It turns out that it relied heavily on human workers in India to review the footage. It’s a stark reminder that behind every “AI” system, there’s often a very human component.

The future of work in the age of AI is not a predetermined outcome but the result of collective choices and actions. As Benjamin Shestakofsky notes in his book Behind the Startup, the arrangement of people, capital, and labor that moves jobs from high-cost to low-cost areas is as much a social and economic phenomenon as it is a technological one. This perspective highlights the importance of considering AI adoption’s ethical, economic, and social implications rather than viewing it as an inevitable force.