Ditching Factory Jobs for Gig Work? Exploring the Impact of Food Delivery Platforms on Employment in China’s Manufacturing Industries

Gig economy platforms provide flexible work options that lower labor market entry barriers and create additional income opportunities for workers. As more workers engage in platform-based employment, concerns have emerged about whether these platforms draw labor away from traditional sectors. This study investigates the impact of gig economy platforms on employment in manufacturing industries. By exploiting the staggered entry of food delivery platforms across Chinese cities as a natural experiment and by drawing on firm-level employment data from the Chinese State Administration of Taxation, we find that the entry of these platforms significantly increased manufacturing employment. Our mechanism analysis shows that these platforms act as a labor reservoir that absorbs workers during economic disruptions and facilitates their return to manufacturing once conditions stabilize. In addition to this buffering role, gig economy platforms also promote labor migration by providing short-term income opportunities that enhance cities’ attractiveness to migrant workers. Heterogeneity analysis reveals that these positive effects are more pronounced in private firms, enterprises with limited investment in employee training, and regions with higher average wage levels. Extending the analysis, we further show that these platforms contribute to long-term improvements in the skill of the urban workforce. These findings offer new insights into the relationship between platform-based employment and traditional sectors and carry important implications for labor policy and workforce management.