Abstract
The rise of gig platforms brings new opportunities and challenges to local labor markets: they may complement offline workers by facilitating service matching and creating jobs for them, or they may substitute offline workers by intensifying the competition among them. Drawing on Skill-Biased Technical Change and digital platforms theory, we study the impacts of gig platforms on local employment in the housekeeping industry. Exploiting the staggered expansion pattern of TaskRabbit (a gig platform that matches freelance labor to local demand for everyday tasks) into US counties at different times, we identify its impact on the housekeeping industry. Our difference-in-differences estimate shows a disproportionate decrease in full-time housekeeping employment in TaskRabbit-operated areas. The decline is mainly driven by cognitive (middle-skilled) workers (i.e., managers) instead of manual (low-skilled) workers (i.e., janitors). Additional evidence, however, implies that gig platforms may not crowd out workers but rather they incubate local entrepreneurship through additional self-employment. Implications for platform design, policy, and research are discussed.