Tag Archives: Gig Economy

Gig workers: guinea pigs of the new world of work

Most discussion of gig workers has focused on their material insecurity. More attention also needs to be paid to what goes on in their heads.
By Pierre Bérastégui – The ‘gig’ economy has grown to become an intrinsic part of our society and yet the benefits and risks of this new way of working are still much debated. Understandably, the employment status of gig workers captures most public attention.

Most European Union member states lack clear regulations on this, so a platform’s terms and conditions determine the status of its ‘users’, based on the existing regulatory framework. Although there are instances of platforms offering employment contracts, most consider gig workers as self-employed.

This is often referred to as ‘bogus’ self-employment: workers are treated as such for tax, commercial and company-law purposes, yet remain subject to subordination by and dependence on the contractor and/or platform. As new forms of work outpace regulation, the key legal challenge is to ensure no workers are left outside of the regulatory framework.

That should, however, not hide the fact that gig workers deal with unique challenges when it comes to working conditions. In addition to the specific hazards entailed by the different types of activities mediated through online labor platforms, there are also risks related to the way gig work is organized, designed and managed. Addressing these is essential, to safeguard working conditions and ensure a socially responsive transition to the new world of work. more>

America’s Hot New Job Is Being a Rich Person’s Servant

“Wealth work” is one of America’s fastest-growing industries. That’s not entirely a good thing.
By Derek Thompson – In an age of persistently high inequality, work in high-cost metros catering to the whims of the wealthy—grooming them, stretching them, feeding them, driving them—has become one of the fastest-growing industries.

The MIT economist David Autor calls it “wealth work.”

While there are reasons to be optimistic about this trend, there is also something queasy about the emergence of a new underclass of urban servants.

Wealth work falls into two basic categories. First, full-time retail and service jobs at places like nail salons and spas. “You’re talking about people with $30,000 incomes that are often employed in high-wealth metro areas, or resort economies,” Muro said.

Because they often cannot afford to live near their place o-f work, they endure long commutes from lower-cost neighborhoods. These arrangements aren’t merely time-consuming; they can also be exploitative. For example, New York City nail salons are notorious for flouting minimum-wage laws and other labor regulations, and massage parlors across Florida have served as fronts for human trafficking.

A second category is the “Uber for X” economy—that nebulous network of people contracted through online marketplaces for driving, delivery, and other on-demand services.

Optimistically, these jobs offer autonomy for workers and convenience for consumers, many of whom aren’t wealthy. But the business models that keep these firms aloft rely on the strategic avoidance of laws like the Fair Labor Standards Act, which regulates minimum wage and overtime pay. These laborers often do the work of employees with the legal protections of contractors—which is to say, hardly any. more>

The Truth About the Gig Economy

By Annie Lowrey – The workforce is getting Uberized. The gig economy is taking over the world. Independent contractor jobs are the new normal.

In the post-recession years, this became conventional wisdom, as more and more Americans took jobs—well, “jobs”—with companies like Postmates, Fiverr, TaskRabbit, and Lyft. But the gig economy was then and is now a more marginal phenomenon than it might have seemed.

The gig economy might be new and big and radical and transformative. It might represent a powerful business model for venture investors and tech companies. But Uber and similar companies were not and are not driving tidal changes in the way that Americans make a living.

Wild predictions aside, it was always clear that many gig workers were taking on these kinds of jobs as a temporary stopgap or a way to supplement their income, rather than as a substitute for a full-time position. A comprehensive look at the Uber workforce by Krueger and Jonathan Hall, the company’s internal head of economic research, found that, “Most of Uber’s driver-partners had full- or part-time employment prior to joining Uber, and many continued in those positions after starting to drive with the Uber platform.”

There’s another reason why a false narrative might have hold: Gig work is vastly more prevalent in the big coastal cities where many investors and journalists live, leading to a kind of media myopia about the scale of the phenomenon. And gig work seemed like the future. more>

Platform Work – Breaking Barriers Or Breaking Bad?

By Irene Mandl – In the abstract, platform work is the matching of supply and demand for paid work through an online platform. In practice, most people are likely to have encountered it through big online platforms such as Uber, Deliveroo or Amazon Mechanical Turk. This is a new form employment that began to emerge in Europe about a decade ago. And while it is still small in scale – estimates of the percentage of workers employed by platforms are in single digits – it is growing relentlessly.

New platforms are constantly starting up, changing their business models and sinking into obscurity. But some have gained a solid foothold and look likely to be around for some time to come.

Increasing numbers of workers are attracted to working this way – for some, out of necessity as they have no alternative employment opportunities; for others, it’s an easier way to get work than looking for a standard job. Some use it as a way to earn extra income on the side – perhaps to pay for a holiday or buy a new car. And some do it simply because they enjoy it – like the designers who use it to showcase their creativity online.

Many try it once and never do it again, others do it regularly but not intensively, and a small proportion of Europeans do platform work as their main income source.

It is growing thanks in part to the ever-expanding variety of tasks being mediated through platforms. At one end are the online micro-tasks – click-work – that do not require particular skills, such as tagging photos. At the other are larger projects commissioned from highly skilled professionals.

The tendency of platform work to encroach on existing areas of business has sparked debate in many EU member states and attracted media attention – the backlash of food-delivery riders against platforms like Deliveroo or Foodora or of traditional taxi companies against Uber have been widely reported.

Platform work does not fit into traditional economic and labour market structures, and is challenging the institutions and legislation built around them. Courts in various countries have been asked to decide whether or not this business model creates unfair competition for traditional operators and whether it circumvents labor law. more>

The Temp Economy and the Future of Work

BOOK REVIEW

Temp: How American Work, American Business and the American Dream Became Temporary, Author: Louis Hyman.

By Gabrielle Levy – The way people work is changing. Machines and computers reduce the need for labor. Companies have shifted to hiring relatively few permanent staff and opting instead to strike temporary contracts with outside workers.

Uber, the ride-sharing behemoth, is perhaps the best known of these modern companies, with its thousands of drivers operating as independent contractors, but it did not invent the form. The roots of the gig economy go all the way back to the years after World War II, with the creation of the first temp and consulting agencies, including Manpower Inc. and McKinsey & Co.

We will see work become less tied to a particular employer in lots of ways. For some people, that’s fantastic, If you’re a consultant or independent contractor and you have lots of control over your life and you get paid pretty well, then this is a fabulous turn. And if you are a gig worker and you are running errands for somebody else, it’s kind of a nightmarish turn.

Do people really want full-time work? Do they want secure work? And the answer is, yes and no.

Everybody likes to work when they want to work, just like every employer wants workers who will start and stop as needed.

How do we create a system where work can be flexible but we can still have a baseline level of security for our health and our families that allows us to take risks and be entrepreneurial and explore new economic possibilities? more>

Rentier Capitalism And Basic Income

By Guy Standing – Fostering globalization in the context of the ongoing technological revolution has been favorable for economic growth globally. But governments and international bodies have signally failed to counter adverse distributional outcomes within countries.

Similarly, in advocating labor market flexibility, negligible attention has been given to the widespread economic insecurities this has generated.

Meanwhile, the neo-liberal phase of globalization has evolved into ‘rentier capitalism’, in which more and more income is going to those possessing physical, financial, or so called intellectual property. Rental income has been boosted by increased firm concentration in many economic sectors – epitomized by the rise of ‘superstar firms’ = and by government action, most notably the strengthening of intellectual property rights protection and the growth of the subsidy state, as governments have chosen to compete by throwing subsidies at large corporations and rich individuals. In so doing, they have regressively depleted public budgets.

One term to describe this conventional fiscal policy is pluto-populism, hereby tax cuts and subsidies are concentrated on so-called entrepreneurs and ‘wealth creators’ while state benefits and public services are cut for low-income groups, ostensibly to reduce the budget deficits that result from the fiscal generosity to the rentiers.

Consequently, in most countries, the share of income going to capital has risen sharply and the share going to labor has plunged. Within the share going to capital, the share going to rentiers has risen; within the share going to labor, the share going to higher earners has risen.

If we wish to escape from the regressive economic paradigm, we must nurture a narrative and vocabulary that focuses on emerging socio-economic groups. In that regard, a global class structure has been taking shape, in which the new mass class is the ‘precariat’. more>

The Many Faces Of Self-Employment In Europe


By Mathijn Wilkens – Despite the growing debates, self-employment in the EU has in fact not increased in decades, remaining stable at around 15% of the EU labor force. This is largely the result of the shrinking agricultural sector – which traditionally has a high proportion of self-employed – counterbalancing the rise in services.

In terms of their working conditions, the self-employed can be roughly divided into five distinct groups.

On one side of the spectrum we find the types of self-employed that the Europe 2020 strategy seeks to promote – entrepreneurial independent self-employed, often enjoying higher earnings and more autonomy which is reflected in healthier, happier and longer working lives. Two of the five clusters – labelled ‘employers’ and ‘stable own-account workers’ – represent about half of the self-employed. The ‘employers’ are a group of self-employed with employees, while the ‘stable own-account workers’ do not employ any employees. Both groups are more likely to be self-employed out of choice.

The opposite is the case for one in four self-employed labelled ‘vulnerable’ and ‘concealed’ –representing together roughly the size of Austria’s population. more>

The Future Of Work And The Social Welfare State’s Survival

By Steven Hill – Europe, like the United States, has seen dramatic changes in how people work. Compared to 15 years ago, many more people have part-time, temp or mini-jobs, or are self-employed.

These shifts provide a hint about the ‘future of work’, and have enormous consequences for people’s well-being, as well as for the survival of the social welfare system.

In the latest phase of this trend, more people are finding work in the ‘digital economy’, via online Web- and app-based platforms. As self-employed freelancers, some work from home, others out of the dozens of co-working spaces that populate London, Berlin, Paris, Amsterdam, Copenhagen, Hamburg, Munich and Stockholm. They don’t report to a regular workplace or employer, and have flexible work schedules, which is an attractive feature for many.

Other occupations are being ‘disrupted’ too, including food delivery, house cleaning, apartment rentals and more. These industries use ‘platform workers’, who receive customers’ orders via their smart phones or over the Web.

Silicon Valley likes to call these workers the ‘CEOs of their own freelancing business’, but that’s just techno happy talk.

In reality, many of them spend more time (unpaid) constantly looking for work than actually finding it. They also don’t have any job security or much coverage from the social welfare system. Wages for these freelancers vary a lot by occupation – those in the tech industry are high, but other occupations barely earn minimum wage. more> https://goo.gl/nL6HTq

The quitting economy

When employees are treated as short-term assets, they reinvent themselves as marketable goods, always ready to quit

BOOK REVIEW
Down and Out in the New Economy: How People Find (or Don’t Find) Work Today, Author: Ilana Gershon.

By Ilana Gershon – Saying that ‘the market is the best way to organize or determine value’ overlooks many sorts of life dilemmas.

Inspired by the Nobel Prize-winner Gary Becke in adopting the market idiom, business writers began to talk about how people need to think about investing in themselves, and viewing themselves as an asset whose value only the market could effectively determine. Over time, a whole body of literature emerged advocating that people should view themselves as a business – a bundle of skills, assets, qualities, experiences and relationships to be managed and continually enhanced.

Not so long ago, business people thought that companies provided a wide variety of benefits to a large number of constituents – to upper management, to employees, to the local community, as well as to shareholders. Many of these benefits were long-term.

But as market value overtook other measures of a company’s value, maximising the short-term interests of shareholders began to override other concerns, other relationships. Quarterly earnings reports and stock prices became even more important, the sole measures of success.

How companies treated employees changed, and has not changed back.

In general, to keep stock prices high, companies not only have to pay their employees as little as possible, they must also have as temporary a workforce as their particular business can allow. The more expendable the workforce, the easier it is to expand and contract in response to short-term demands. These are market and shareholder metrics. Their dominance diminished commitment to employees, and all other commitments but to shareholders. more> https://goo.gl/vAoBxe

The New Normal: Radical Inequality, Suffocating Debt, and Growing Job Uncertainty

By Servaas Storm – The U.S. economy is suffering from two interrelated diseases: the secular stagnation of its potential growth, and the polarization of jobs and incomes. The two disorders have a common root in the demand shortfall, originating from the ‘unbalanced’ growth between technologically ‘dynamic’ and ‘stagnant’ sectors, which—crucially—is bringing down potential growth.

The key mechanism is just this: rising real wages, as during the period 1948-1972, provide an incentive for firms to invest in labor-saving machinery and productivity growth will surge as a result; but when labor is cheap, as during most of the period 1972-2015, businesses have little incentive to invest in the modernization of their capital stock and productivity growth falters as a consequence.

Financial globalization, in addition, enabled the rich to have their cake (profits) and eat it (by channeling them to offshore tax havens or into derivative financial instruments). In this way, trade and financial globalization have been essential building blocks of the dual economy. more> https://goo.gl/5EFndw