FT: AI automation is starting to carve up the gig economy

Gig work has long served as a safety net for people shut out of formal jobs, from freelancers on Fiverr and Upwork to drivers on Uber and DiDi. That net is fraying. AI is automating simple freelance tasks, hammering demand and share prices on gig platforms, while self-driving cars threaten driving work in the US and China. Because gig workers have no employer, there's no clean layoff to track, just fewer tasks and shrinking pay, unfolding quietly. With between 154 million and 435 million people relying on gig work globally, policymakers may not notice the damage until it's already done..By Sarah O’Connor.Whether with a smile or a shudder, both the champions and the critics of the “gig economy” have often portrayed it as the future of work. But has it actually put workers on a fast track to being displaced by automation?This year has brought a reckoning for white-collar gig platforms like Fiverr or Upwork, which connect companies to freelancers all over the world to complete well-defined projects such as copywriting or graphic design. It turns out that by breaking jobs into tasks that are performed remotely, stripping them of the need for institutional knowledge or personal relationships, they have made that work particularly vulnerable to being replaced by AI.Fiverr reported a “clear deceleration in overall marketplace traffic and demand” in the second quarter of the year, according to the prepared remarks of chief executive Micha Kaufman. He attributed this in part to “recent model updates across various LLMs” and said: “Put simply: AI is automating simple tasks.”Upwork, meanwhile, reported “accelerated AI adoption” in the first quarter which “degraded the volume of client activity on the low end, impacting contracts of $500 and below”. Although both platforms say they are pivoting towards higher-end work less vulnerable to automation, investors are not convinced. Fiverr and Upwork’s share prices have dropped 61 per cent and 47 per cent respectively over the past year.In the blue-collar realm, meanwhile, physical automation threatens a number of the roles which have been performed by gig workers, such as driving and delivering parcels.In June, the head of one of China’s biggest ecommerce groups warned that its 700,000 delivery workers would be replaced by robots “sooner or later”. In the US and China, drivers on platforms such as Uber and DiDi eye the arrival of self-driving cars with deep unease. Uber has even started to lobby on behalf of drivers (an irony not lost on drivers themselves), pushing for a slower deployment of self-driving cars to ease the transition. It also wants rules that would require ride-hailing platforms to have “hybrid networks” that combine self-driving cars with human drivers.It is a self-interested move from Uber to protect its model from disruption from “pure-play” self-driving apps. But that doesn’t mean it is wrong when it warns that robotaxis could mean “less work for many drivers over the long run, including people who rely on platform work as a flexible safety net”.Gig platforms have indeed become a safety net for people who have fallen out of — or struggled to access — the formal labour market. A report by the World Bank in 2023 estimated there were between 154mn and 435mn online gig workers globally, representing between 4.4 and 12.5 per cent of the global labour force. Among the advantages of this development, according to the report’s authors, are that it “helps manage income shock” and “serves as unemployment insurance”.China is perhaps the best example of a country in which gig work has served as a labour market shock absorber. Amid a prolonged construction downturn and the increasing automation of manufacturing work, the number of people who work as food delivery or ridesharing drivers in China increased by 10mn in two years to reach 53mn in 2025, according to estimates by the China New Employment Forms Research Center, a Beijing think-tank.So what happens if the shock absorber gets hit with a shock of its own? Because nobody employs gig workers, there is nobody to fire them either. Instead, the impact is likely to unfold under the radar in the form of fewer tasks and lower incomes, rather than the sort of job losses that economists usually trace.Underlining the point, there is little data available so far on the effects of robotaxis on drivers. However, one study from Gridwise, a rideshare assistant app, suggests that pay per trip for drivers in US cities with self-driving cars declined between July 2024 and July 2025 relative to the nationwide average.Upwork, meanwhile, offers a glimpse of how bleak these platforms can be when supply and demand become badly imbalanced. Workers on Upwork now have to pay to submit proposals for jobs using a system called “Connects”. They can also pay extra for the chance to “boost” their proposal to the top of the client’s list or to put an “available now” icon on their profile..Read more:.The Economist: What if $3trn AI boom goes wrong? Plenty of people will lose their shirts.The threats to these particular workers and platforms do not mean the demise of the underlying gig economy business model. New platforms are already beginning to emerge which cater to different markets, either in harder-to-automate areas of work such as healthcare, or in white-collar areas in which AI itself is generating new demand. One example is Mercor, which pays lawyers, journalists and bankers, among others, to help fine-tune AI models to do their jobs — thereby potentially hastening their own demise. But new platforms and types of work won’t necessarily absorb the same people who are displaced from old ones.The gig economy was never a great safety net, since it leaves people with no employment rights or protections, and patchy support from the state in terms of pensions and benefits. But now there is a new danger: robots are quietly nibbling holes in it. Policymakers might not notice until the bottom falls out..© 2026 The Financial Times Ltd..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. 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FT: AI automation is starting to carve up the gig economy

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