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Etsy has been thinking hard about the gig economy.

The online marketplace for handmade goods knows its sellers aren't traditional gig economy workers. They're not paid hourly, and they're not delivering food or driving an Uber. Etsy sellers would be more likely to think of themselves as small business owners than contract workers.

Still, Etsy is part of the gig employment marketplace. Its users depend on an outside platform for their livelihood, and their work on Etsy doesn't come with traditional employee benefits.

That's why Etsy has a few proposals for how to improve economic security for gig workers, and for its sellers. In a report released this week, Etsy proposed three ways the federal government could create a "social security net" for independent workers.

SEE ALSO:67% of workers in the gig economy wouldn't join it again

Etsy says its sellers and others in similar positions need a single place to manage all benefits, regardless of where they work; a simple way to fund those benefits outside of payroll; and a way to manage income fluctuations.

Specifically, Etsy proposes a Federal Benefits Portal tied to individuals rather than jobs, tax withholding to fund benefits and a single MyFlex Account rather than various tax-advantaged savings accounts to help manage income fluctuations.

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"No matter how you work or who cuts your paycheck, everyone should have a social safety net that protects them in times of need. As work changes, more people will be able to pursue their passions on platforms like Etsy," wrote Althea Erickson, global policy director of Etsy, in a blog post about its new report. "We believe in enabling sellers to start, grow and manage their businesses on their own terms. But they need the financial security and protection to do so."

The number of workers with alternative work arrangements rose by 9.4 million between 2005 and 2015, according to a recent report from Harvard and Princeton economists. The total number of independent workers is forecasted to grow to as many as 54 million by 2020.

While the growth in independent contractors has been fast, progress in reconfiguring the workplace and benefits structure to support them has been slow. Care.com recently launched a benefits program for the caregivers who use its platform that — while limited in scope — is one of the first efforts to provide benefits to gig workers.

Most other companies that lead the gig economy haven't taken steps like Etsy's. Uber, for example, is more often at odds with its drivers over their classification as gig economy workers. The company is still trying to settle a lawsuit over whether its drivers are contract workers or employees.

Etsy says it supports 1.7 million "micro-businesses" through its platform.

The company's public policy team crafted this report. Etsy is bringing 16 of its sellers to Washington, D.C. this week to lobby legislators on this issue.

Etsy also announced the launch of a research fellowshipthat will provide grants to PhD candidates studying these workplace issues.

TopicsUber

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