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ABC Test Linked to Significant Job Losses, Study Finds

1/12/2025

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Summary

Story summary

A recent analysis indicates that the ABC test for reclassifying independent contractors has caused notable employment declines in adopting states.
W-2 employment decreased by 4.73%, while self-employment dropped by 6.43%.
Total employment fell by 4.79%, especially in sectors reliant on independent contractors.
These trends may negatively impact state economies through reduced consumer spending.
The study urges a reevaluation of ABC-like labor policies to foster employment growth.

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Story summary

A recent analysis indicates that the ABC test for reclassifying independent contractors has caused notable employment declines in adopting states.
W-2 employment decreased by 4.73%, while self-employment dropped by 6.43%.
Total employment fell by 4.79%, especially in sectors reliant on independent contractors.
These trends may negatively impact state economies through reduced consumer spending.
The study urges a reevaluation of ABC-like labor policies to foster employment growth.