On the other hand, while worker protections had their use a century ago, they have increased cost of labour by a lot, making many low skilled workers unemployable (the very people they were supposed to protect). I've talked to many gig workers and they all told me that without these jobs, they would have nothing. Sure, we can start imposing strong "protections" on the gig economy, but these jobs would just disappear and those workers would be out of jobs again. No one plans a career on doing gigs their whole life, but for many it's a better source of revenue than just being unemployed and they feel less stuck in unemployment and more accomplished than they used to, which is better for moral and making them want to improve their skills/get back in the labour force.
If the current way we structure our economy and society is failing large swaths of people, gigs might be a good stop gap, but how many people can be gigified before the whole thing breaks? What is the acceptable percent of people for whom it is ok that they will never have healthcare?
Not sure how this is related to healthcare. I'm from France where everybody has healthcare and the gig economy is still huge. In the US you could either go single payer like France or full private/free market but obligatory like in Switzerland or the Netherlands. Either way, this is not related to the gig economy. The US has a problem where an oligopoly of insurances are trying to keep a bad status quo.
Sorry if I was unclear. My point is that gig workers in the US and other people of transient employment status do not generally consider themselves to have access to healthcare, even though they technically do through the accumulation of unpayable debt.
That’s about 300% of the federal poverty line. Under the ACA, they can purchase health insurance on the exchanges for a premium that is capped at 8-10% of their income.[1] In Germany, a self-employed person would pay 15% for mandatory state health insurance premiums. (People who work for a company pay half of that, with their employer paying the other half.)
Here in Maryland, a quick search of the ACA exchange shows a Silver Kaiser Permanente plan for $266 per month (subsidized) for a 35-year old single person making $35,000.
2/3 of Uber drivers only do it part time, so the median isn’t a useful data point if you’re talking about health insurance. The $36,00 figure is for full time. Regardless, if someone makes less than that driving Uber, their ACA premiums are correspondingly lower. And if they make really little, they are eligible for Medicaid in many states.
In germany consistently working for a company like Uber as part of "gig" would likely fall under "fake self-employed", so Uber would have to offer you an employment contract and you'd pay half of the 15%, so about 8%, which falls on the lower end of your premium caps. You'd also gain accident insurance and other privileges or protections.
It’s just an absurd situation that health care is tied to employment in the first place. If you get sick and can’t work, you just become a burden on society that’s not accounted for anywhere — but society still has to pay for anyway.
And we wonder why our healthcare costs are so high...
We aren't failing people: unemployment hasn't been this low in 20 years.
We have spent 28 trillion dollars on welfare, yet the poverty rate is unchanged over decades. The only thing that supports people is work, and we need to eliminate as many impediments to it as possible: over-regulation, payroll taxes, income taxes. Make huge cuts to welfare with the savings and streamline healthcare to provide cheap, basic services to every citizen (in line with disallowing citizenship by birth).
Then, regulate the supply of labour by barring immigration from poor countries (establish a liberal visa regime with countries in the HDI top 30 though, to allow legitimate talent to come to America). You have the recipe for a reasonable, modern life for any American willing to work. It could be a blueprint for the whole Western world.
If you were serious about providing a reasonable, modern life for Americans wouldn't you provide high quality free healthcare as a basic right? Wouldn't you provide free education and eliminate student debt? Wouldn't you ensure a dignified retirement and old age for all?
Your manifesto doesn't include these things, why not?
> streamline healthcare to provide cheap, basic services to every citizen
Already covered that.
We can pay for healthcare for all citizens, but it will mean excluding very expensive things like heart surgery, cancer treatment, joint replacements. We will probably need to be much more forward on euthanasia for the old, to save resources.
We can provide free higher education, but its going to mean no student housing, no athletics programs and restricting college to the top 20% of the cohort academically.
Why should we have to tax the current worker population in order to pay for old people to do nothing? The current retirement system is a flawed ponzi scheme. People have continued to work until death or impairment in the past - why should retirement be considered a human right now?
Cut payroll taxes and income taxes, and the elderly can happily work 1-2 days per week, and businesses will be happy to have them. Store clerks, fast food workers, cleaners, child carers. These jobs can be done well by the elderly, and work keeps the brain active and healthy.
What if I want to work part-time throughout my life, and never retire? Shouldn't I have the ability as an individual to decide how and if I want to retire?
What is it like to live in a country where things that every other developed country seems to be able to afford (like public health care) are impossible without invoking “euthanasia for the old”?
One can read a lot into that chart, depending on one's own bias.
For example, if jobs get better, then families can live on one income. This is good. We're still way above the workforce participation of the 1950s, which generally was a better time for family life in the USA.
which generally was a better time for family life in the USA.
I suspect a good chunk of the population would dispute that statement. In general I think there is a lot of rose colored glasses about that period of time.
Regardless - I haven't seen any evidence that we are returning to a general viability of supporting a family on one income, at least supporting it well. Do you know of any?
What if gigs aren't a stop-gap, but the way our economy and society is failing people?
This has been going on for decades---I can remember complaints about UPS, etc., delivery employees being replaced by contractors, and I've worked for places with the infamous 19.5hr/wk schedule.
>they all told me that without these jobs, they would have nothing.
There are two things going on here that makes this more complicated that meets the eye. For one, as you have pointed out, lowering the price of labor increases the number of things people would be willing to hire someone to do, thereby increasing the number of jobs. However, it's also true that by removing the protections for one specific form of labor but not all, gig economy companies will have a competitive advantage over classical employment companies and put them out of business. So, the gig economy is reducing the number of "classical" jobs.
These effects point in opposite directions, and without being able to put numbers on them there's no way judge which wins out. Measured in terms of "money paid to low-skill workers," the reduction in everybody's wages might or might not be offset by the increased number of jobs, an increase which has been attenuated by the gig economy replacing some of the old economy.
It's possible for different countries to adopt the same policy for different reasons. Many countries get around diversity issues by not having diversity.
Read the article, it's not just the US, South Africa too. And I know it was the same in France and many European countries to prevent low skilled immigrants from getting jobs. My point is, worker protections almost by definition prevent low skilled workers from getting jobs because they impose additional costs that low skilled workers are the first to pay by losing job opportunities. In the economy, any additional cost has to be paid by someone eventually, guess who that usually is.
Only 4% of people are paid minimum wage, everyone else is paid above http://poverty.ucdavis.edu/faq/what-are-characteristics-mini... so even if there really was a "race to the bottom" it would only affect those 4% and then most people would refuse to work for a salary that is so ridiculously low that staying at home would be more beneficial.
The free market is the best (or less worse) system at giving people a wage as high as possible compared to socialism. Now, we're talking very low skilled people who can't seem to get a job anywhere, in this case, increasing barrier to entry only makes things worse. Given that most jobs require skills, most jobs are paid above minimum wage thanks to free market competition so no race to the bottom would happen in most case and even then the market would fix a limit (ie no one would accept your offer if it's too low, same reason no one in SV would accept an offer below $100k ;).
> Should workers be able to unionize to demand better from their employers?
Absolutely, there can't be a free market without freedom of association.
In your argument to reduce worker protections you seem to ignore the contradictory stance of increased unionization with lower worker protections.
Unions by definition will increase the number of protections for workers and increase the costs of labor.
Personally I take an opposite stance: the problem with the free market is that it has to optimize for infinite growth. It doesn't matter if you make profit, you have to make the most profit or you're a failure. Which means removing insurance for workers, minimizing wages, maximizing unpaid overtime etc. The free market is fundamentally at odds with workers and that's why companies employ lobbying and union busting behavior.
> the problem with the free market is that it has to optimize for infinite growth. It doesn't matter if you make profit, you have to make the most profit or you're a failure. Which means removing insurance for workers, minimizing wages, maximizing unpaid overtime etc. The free market is fundamentally at odds with workers and that's why companies employ lobbying and union busting behavior.
Have you ever ran a company? Most people running a business care about all these things you're enumerating and no one believe in infinite growth.
Unregulated capitalism will externalize all of its costs onto society. Too much regulation will strangle the system. Like with most things, there needs to be a balance. Similarly, capital will exploit labor without regulations or unions to prevent it from doing so.
Now yes, of course capital is going to seek the locality with the cheapest costs of production, so there is a tension between competitiveness and ensuring a minimum standard of living. Cities, states, countries, ultimately have to work together to balance these demands.
If your solution to all of this is a laissez faire system that relies on the fact that "most people care"... it is I that has to question your naïveté.
> Unions by definition will increase the number of protections for workers and increase the costs of labor.
This is only true insofar as the market is inefficient.
Suppose you have a free market for car services (i.e. no taxi regulations or similar) and the drivers all get together and unionize. They demand higher wages and get them. The only way the company can pay higher wages is to raise prices, so they do, demand for car service is reduced, and some of those people lose their jobs.
Since they're no longer employed, the people laid off quit the union. Car Service Number Two shows up, has no contract with the first car service's union, pays the original lower wage to the people put out of work, and attracts customers by charging lower prices. That causes Car Service Number One to lose business and have to lay off more drivers who then go to work for Car Service Number Two, and so on until everyone is working for Car Service Number Two. If they then unionize again, Car Service Number Three appears to hire the workers laid off due to the higher wage ad infinitum.
Which is why unions don't work in competitive markets.
> the problem with the free market is that it has to optimize for infinite growth.
There is nothing that requires this. What it needs to optimize for is efficiency. If you're paying $50 then you have to charge >$50 and you lose business to the competitor who pays <$50 and then charges <$50. But at scale this isn't a problem -- when everything you buy costs less, it isn't a problem that you get paid less.
The problem now is regulatory costs and cost disease preventing the lower prices from actually happening in many cases. But you can't fix high regulatory compliance costs by increasing regulatory compliance costs.
No offense, but this is an incredibly reductive take on unionization and ignores the history of unions in competitive markets in the US.
People who are laid off don't just quit the union; unions often offer additional support for members who are laid off including aid for job seekers. A great example of how unions exist in a competitive market is SAG-AFTRA which by your own argument simply shouldn't exist. If you're going to make an argument against unionization, you shouldn't take one that can be empirically disproven.
> People who are laid off don't just quit the union; unions often offer additional support for members who are laid off including aid for job seekers.
What kind of job seeking assistance are you imagining in a car service union? The services themselves already tell you when work is available automatically and the problem is that there are more workers than there are jobs at the higher wage.
Moreover, if you're going to offer things like that then you have to gatekeep union membership and then your problem isn't that people quit the union, it's that they can't even get into it if they wanted to, and would then happily take any non-union work they can get.
> A great example of how unions exist in a competitive market is SAG-AFTRA which by your own argument simply shouldn't exist.
It shouldn't exist if Hollywood is a competitive market. But it isn't. There are a handful of major studios that make substantially all of the major motion pictures and control the major channels of distribution and promotion.
Before the internet it was effectively impossible to strike out on your own as a high grossing studio. It's still extremely difficult using traditional channels. What we're seeing now is individuals doing it using platforms like YouTube -- but they're hardly making anything like what Hollywood does and the various YouTube celebrities are generally not SAG members either.
"This is only true insofar as the market is inefficient."
I think you are right. Unions are by definition all about a (a kind of external) negotiating power. Such things have no place in ideal and fully efficient free markets where the prices are dictated solely by the demand and the supply.
Either such a market would be robust enough (as in your example) and the union would not be in a longer term viable, or the union would be viable (e.g. some kind of monopoly) thus turning the market into a non-ideal, non-efficient and non-free.
However I am yet to see (or realize that I see) a labor market that would be in any meaningful way close to being efficient and free. The labor markets I see have low liquidity (it is difficult to search and change the work, it takes time to adjust your skills), huge information asymmetry and low transparency, and the most actors are not very "free" (debt, no alternative options...).
Unionization is well beyond freedom of association. It's freedom to enforce a monopoly. Can you be consistent, having no objections if others do that too? For example:
Airlines form their own sort of union. (we might call it a cartel) They decide to agree on prices instead of competing. Prices double.
Fueling stations do likewise. They agree that gasoline should be $12 per gallon.
Cell phone providers decide that you should pay $1 per megabyte. They all agree, being in their union, that they won't work for less.
There are only a few companies in each of the industries you mentioned while there are millions of workers. There is already huge asymmetry in power and organization. You completely gloss over that fact.
There is a difference between creating laws that deliberately exclude a large portion of a country's citizens (America and South Africa) and laws that as a side-effect make it difficult for immigrants to get jobs (Europe). The citizens of a country should not be subject to exploitative labor practices simply in order to make life easier for low-skilled non-citizens who choose to immigrate.
For ridesharing apps, at least, it seems clear that the gig economy has grown the total market and hence the number of workers needed to serve this market. Before Uber entered New York there were ~500k cab trips per day: now, yellow cabs only serve 250k trips but 700k trips are performed by ridesharers [1]. The negative effect on employment is about 3x smaller than the positive one.
Please do not confuse ridesharing with ridehailing although the companies like Lyft und Uber invest a lot to blur the line.
> Before Uber entered New York there were ~500k cab trips per day
This is not a good argument as Uber & Lyft are not yet making profit and in general you cannot compare both numbers as ridehailing grabs trips from public transit:
>So, the gig economy is reducing the number of "classical" jobs.
Sure, but the gig economy started from displacing jobs that were caught in regulatory capture. Most of the people that the earlier post talked about wouldn't be able to get a job as a taxi driver due to regulations. I think that, so far, the gig economy isn't pushing heavily into areas that aren't suffering from regulatory capture.
Would they be out of work otherwise? I saw no lack of deliveries or taxis ten or twenty years ago.
Delivery drivers have been moved from secure employment to the gig economy and enforced self-employment. Uber drivers would previously have been taxi or private hire drivers.
The problem comes when, after a few months, many realise that the gig role they took simply doesn't pay. Or pays significantly less than minimum wage without rights and benefits that everyone else in the economy takes for granted.
For the most part it's simply a way of larger companies outsourcing part of their labour costs to the state (via top-up benefits).
There are orders of magnitude more uber drivers now than there were taxi drivers ten or twenty years ago. The point isn’t that these jobs didn’t exist or were replaced 1:1, the point is that there is a super steep demand curve in these services so a drop in price by 10% means 10x demand at that reduced price, which means the number of drivers now is much much more tha. It used to be to satisfy those orders
> The point isn’t that these jobs didn’t exist or were replaced 1:1, the point is that there is a super steep demand curve in these services so a drop in price by 10% means 10x demand at that reduced price, which means the number of drivers now is much much more tha. It used to be to satisfy those orders
Let me go out on a limb and say: who gives a shit that there’s now more demand? This is not a good thing, demand for Uber is often replacing demand for public transit and bringing with it additional congestion[1], pollution, and waste in the classical “broken window” style. This is economic growth for the sake of itself - not towards any kind long term prosperity for the human race.
It isn't doing it quietly, it's running around yelling in the streets banging pots and pans. Outside the bay area I have never had an Uber driver that did not drive as their full-time job. (Actually my most strange memory of San Jose was being driven by a dad going to pick up his son from school.) But what's someone to do if their other option is not to work at all?
My mom used to work two jobs in the early 2000s, and it was always a struggle because so many retail jobs (or at least retail managers) will intentionally randomize schedules, such that even if you are working 30h/week you can't hold another position because in any given week the schedules are likely to overlap. The gig economy is a weaponized response to this variability IMO.
> But what's someone to do if their other option is not to work at all?
So, let's imagine all wishes of Uber opponents came true and Uber doesn't exist anymore. What does it mean for that "someone" - back to "no work at all", right? Do you think that change improved his situation?
> so many retail jobs (or at least retail managers) will intentionally randomize schedules
Why? What advantage does it provide to them? Also, isn't retail job the very one that has centuries of protections and, as the topic article claims, must survive and serve as a model while Uber jobs must be gone?
A lot of worker protections are reserved for full-time employees -- like healthcare, breaks, paid sick leave. In theory, you don't have to give full-time employees vacation time, but in practice most full-time employees get vacation time, and very few part time employees do.
That's part of the Under-employed crisis in the US. When people talk about worker protections, they're not talking about part-time work.
Additionally, very few full-time employees have anything remotely like a randomized schedule. The medical industry is the only industry AFAIK that resembles randomized schedules at all. Yet this is VERY common in part time work.
> That's part of the Under-employed crisis in the US.
Let's imagine, again, the wishes of the progressive forces came true and the part-time jobs are banned forever, together with gigs and side jobs and contracting and interning and whatever it is that is not 100% full-time fixed steady job - all other ways to get employment is verboten. Would you think people that are now working part-time jobs would be better or worse off? If, say, someone is a mother working part-time because she needs time to take care of the kid (and she doesn't mind giving up vacation time for being able to actually spend time with the kid when she needs it) - would she better off losing the part-time job or being required to work full-time and hire a full-time (remember, no part-time jobs anymore!) nanny or give the child to the mass-warehousing facility for kids while she is working? Would the person who has a side gig because his main job does not provide enough income be better off losing that gig? Would we be better off is we solve the crisis by destroying the part-time employment?
1. We are agreeing, not sure why the argumentative tone.
2. If you have 10 employees, late shift only twice a week, only 3 of them are trained to open the store, and employees constantly swapping hours, it can be hard to provide consistent hours for everyone. "Intentionally randomize" could have been restated as "regularly unstable"
I am still not getting the last part. I understand that if small number of employees only can take care of a vital function, then they must be carefully scheduled so that the vital function is covered all the time. How exactly randomizing is achieving this? If I planned it, I'd say randomizing is the worst method ever to achieve it, so I wonder what I am still missing - what advantage the employer gains in randomizing the hours? I can't see any.
Low-wage employers often don't generate or issues schedules far in advance. The longer they wait to issue a schedule the more flexibility the employer has. Often this involves giving shorter but more frequent shifts to keep workers who work 4 or 5 days a week from accruing enough hours to be consider a full-time workers (and qualifying for benefits).
What you have described sounds logical, but it's not randomizing. It's giving out shifts by specific and well-defined criteria (maybe unethical or undesired by the worker, but hardly random).
One of the interesting aspects of the gig economy (speaking mostly about ride-sharing) is sure the pay may be bad and the hours may be bad for certain regions/areas/drivers. But Uber and Lyft don't impose any sort of requirements. You can work exactly when and how much you want to work. That in and of itself is a huge win for workers. Part of the problem is Uber and Lyft also don't limit how many drivers drive at any given time, which results in some inefficiencies (which are mostly just felt by the drivers). If there are too many drivers on the road, fares go down which is good for everyone but the drivers: Uber will keep taking it's cut; riders get cheap fares quickly.
I think the fact that people can drive 15 hrs a week if that fits their childcare schedule or drive 60 hrs of week to pay for a vacation is incredibly valuable.
Part time employment is very different from 'unpredictable hours with no certainty and poor workers' rights' which is what much of the gig economy actually is.
Part time employment with flexible working hours is a good thing, but that's not a benefit that the gig economy delivers, in fact quite the opposite.
An unregulated wage economy suppresses wages to the point that workers must work ever increasing hours to make a living wage. If that stops being the case, there will be someone willing to work a little longer for a little less. This feeds into a cycle where wages are suppressed right down to the point where to make a living wage you actually have to be working all the time.
Far from gaining control to "set your own hours" you actually get pressured into more and more hours.
Contrast to regulated industries where you are either salaried, or supply is restricted so that workers can genuinely earn and set their own schedules without feeling like they'll lose out by taking any breaks.
Describing the gig economy as some kind of workers' nirvana is just deceptive and wrong.
> workers must work ever increasing hours to make a living wage.
That sounds like trying to use the gig economy to make a living. I'm sure some people could do it, but it's hard like you mention.
The gig economy is designed for short, flexible gigs to supplement your income not replace it entirely. The people that are trying to make a full income entirely from piecing together tons of small gigs I'm sure are struggling because that's not what it's claiming to do. It's primary function is flexibility, not keeping up with the Joneses.
FTE is for building wealth, the gig economy is for flexibility. The gig economy filled a much needed gap for people that only want to work a few hours a week or like variety in their work. It's not supposed to be the cure to fill time employment, just an alternative.
It's like complaining that a "tiny house" isn't big enough. It's not what it was designed to do.
But the fact is that a lot of people ARE trying to use the gig economy to make a living. In many cases because it's the only option open to them.
When gigs represent an ever-increasing percentage of the employment available and steadier work is becoming harder to find, how are people expected to make a living?
As a small business owner it's a huge pain to hire employees. Payroll, taxes, health care, retirement, PTO, etc. add so much complexity that the only real solution is to hire a payroll agency to do that for you.
With a contractor, or a gig, you can define a single project price or hourly rate, sign a short contract and get down to work.
Another problem with Uber/Lyft is that a significant portion of their earnings comes from "quests" like "N rides today" or "N rides this week". Given the very low base pay, this incentivizes drivers to work long hours, with no breaks.
that’s the point of the gig economy, the big corps that run the world. don’t want to have to pay worker protections. pension contribution, sick pay. pain holiday, it cuts down on their bottom line. better if everyone is a contractor they can get rid off.
My take is that gig economies are a band aid solution over the fact that a large fraction of the workforce needs to retrain itself in tech. I'm optimistic about universal basic income to help people get started but let's be real tech is gonna be a huge pie and I find comments like there's no way a truck driver can learn how to program extremely cynical. Relative to a 1,000 years ago any human today is a technological genius so we shouldn't underestimate humans.
I am of the opinion anybody can learn to program, but there is not an infinite demand for developers. In fact, more probably already exist than necessary. Any jobs that can't be filled are probably more the result of hiring inefficiencies than anything else.
Also, software development as a discipline is filled with highly (and formally) educated people. A lot of the non-traditional (non-computer science) developers at least come from a math/science/engineering background. Even if you have the skills, these people will not allow their ranks to be sullied by the "unwashed masses" who didn't "work as hard" as they did. (Quotations to indicate these are not my personal thoughts, but I am not quoting a specific source).
"Tech" is not going to provide jobs for people who previously did manual or clerical work. It's intrinsically geared towards automating away those classes of labour, without any guaranteed provision of a one-for-one replacement of 'old' jobs with tech jobs. I would be surprised if the level of technical skills of the population increases over the next few years. There's really no reason to expect that it should.
Yeah, it's pretty ridiculous to expect a one-to-one replacement.
Let's imagine a large bank that closes down 1000 branches with 10 employees each, due to online banking becoming more prevalent. Does this mean that the bank suddenly (or ever) needs 10,000 extra developers working on their online banking? Not even close!
I've been programming for 30 years. I have also spent most of my career as a contractor, startup developer, or a gig worker on Upwork or something.
I'm sure that many HNers will try to claim that I am a bad programmer or something. I believe the reality is that a large portion of the market for software engineers just doesn't have a lot of resources and so is looking for ways to save money. Not dealing with benefits or even minimum wage is a way to do that.
HN likes to think that low paid or non-benefit work for software development doesn't exist. It is a huge global industry in fact.
The gig economy is exactly what the world needs: flexible, fungible work that provides opportunities to people who might not otherwise be able to get full-time jobs. College students, mothers, elderly, etc. Anyone who needs tremendous flexibility in their schedules.
This is a great thing and I’m not sure what all the hate is about.
That's what it should be, and what proponents say it is.
But the reality is that established fulltime jobs are being supplied by "the gig economy" creating a class of worker who previously would work full time but now work similar jobs doing mostly similar hours but without the protection they previously had.
If full time jobs are being replaced by ZH contracts to fill the same role, it's not workers' who benefit, it's companies.
Absolutely, there are plenty[1]. A lot of previously minimum wage employees have been 'converted' to ZH contracts in particular:
* Care home assistants and other social care
* Retail staff
* Food manufacturing
* Farm labour
* Package and food delivery
* Food service industry (restaurant staff)
And many, many others.
Most of the gig economy is not facilitated through tech companies and apps like uber or deliveroo but instead managed and provisioned through outsourcing companies.
Huge swathes of the low-knowledge service economy have been replaced by these zero-hour contracts which characterise the "gig" economy. The workers have a very asymmetric relationship where the work-provider is generally free to offer or not very short-term contracts or 'gigs' while the worker is generally pressured to accept everything else risk being effectively black-balled by the work-provider.
This is typically all done through a third party provider and further increases the 'distance' between the worker and the actual service being provided. This has really damaging long term effects for both the worker and the business.
Outsourcing isn't particular new but the rate at which 'zero-hour' contracts and the wider gig economy has been alarming. It has gone from less than 1% to double-digit percentages of workers in some sectors on ZH contracts.
I believe that any such outsourcing is damaging, a worker who works for (and not even employed by) a third party outsourcing company is unlikely to feel the same pride than a direct employee, but more concerning is that domain expertise is not kept and nutured within the company but instead diluted. There is less opportunity for knowledge sharing across domains if different job roles within the workplace are not just siloed but actually fulfilled by different outsourcing companies. Having a sense of shared ownership and an opportunity for casual knowledge sharing between different parts of a business is essential for 'eureka' type moments to bring breakthroughs in improvements to ways of working or problem solving.
In the outsourcing model people are seen a merely a resource to be managed. It doesn't matter who is turning up to do that role as long as someone does.
Zero hours and the gig economy stretches this to breaking point. Both ends of the equation lose stabilty. The business no longer has stability of knowing which employees will be around next week, so is therefore less likely to invest in upskilling, and the workers don't have the stability of knowing if they'll be offered any hours the following week so lack the stability to make long term decisions.
The accountants back at head offices of course see it as a win/win. The busiess, e.g. a restaurant no longer has to worry about whether they'll have to recruit for staff at short notice because of high turnover, because it's a different company's problem to find and supply the staff and the reduced risk that brings, and not directly employing staff reduces the overhead of managing payroll or even if they are managing the contracts reduces some tax overhead (e.g. employers NI contributions).
You might not recognise this as the 'gig economy', especially if you work in an "at will" state in the USA, but in the UK these zero-hour contracts are a large part of what we see as the gig economy because it differs so much to the established rights that we enjoy as employees.
In fact legislators worked hard to establish new "workers' rights" to increase rights for workers without needing full employee rights so workers at least get some protection.
All of this also contributes to lower social mobility. The ability for someone to climb up from the lowest 'rung' of an organisation was a rare but treasured part of corporations. Many older companies have such stories as part of their folklore. But in the outsourced gig economy, what were the bottom rungs of the ladder are no longer ...
"All of this also contributes to lower social mobility. The ability for someone to climb up from the lowest 'rung' of an organisation was a rare but treasured part of corporations."
I was looking for temp jobs recently, and I went to an interview for a mailroom job. I thought of the cliche of the mailroom employee who works their way up to CEO, and when I got to the interview, you guessed it - I wasn't interviewing with the company I thought I was, but a contracted provider of services in the same building. So, no CEO potential.
I also used to work for a division of a Fortune 500 company and noticed that the janitors were, again, outsourced and not employees of the company.
Something I don't see you mention, though, is that governments are taking advantage of outsourcing too. I am in fact working for a state government at the moment as a temp. I'm basically doing the same thing as an employee would, but without the civil service protections. There may or may not be opportunities as a result.
You can replace 'gig economy' with 'contractor'. The idea of contracting has been around for many years before Uber and Lyft and is different than the worker rights you get when you are a full-time employee.
I also don't see it replacing anything. Every company isn't going the gig route. It's just not practical.
"They were not employees and so had no health insurance, workers’ compensation protections, employer contributions to Social Security and payroll taxes, paid time off, family leave protections, discrimination protections, or unemployment insurance benefits"
This was never part of the deal. I don't get any of this selling my items on Ebay either.
"Sometimes, this gig work also requires an initial outlay of capital. (My own neighbor just traded in her old vehicle for a new car, taking on thousands of dollars in debt so that she can make extra money driving for Lyft."
So no actual research before diving in and buying a new car? Not a smart move and not Lyft's problem.
"Platform algorithms are designed to downgrade those who aren’t always available, making it ever-harder to pick up gigs"
As a Lyft customer, would it make sense to have someone pick me up that may not even be there? That would be a horrible customer experience.
"Uber, for example, offers email communications to drivers, a service that is not nearly as responsive as the taxi cab dispatcher, say"
Was this article written by the Taxicab unions? You can regulate and force companies like Lyft to make all of the drivers employees, pay them a good wage, and give them benefits. But, this will cut the workforce significantly because the bar will be much higher to become a driver. Many of the people driving now will be out of work.
“The disruption offered by the sharing economy is simply a hustle.”
It really depends on your goals. The gig economy allows more people to make less money. Just like any market, there will be a small percentage making the most money, some in the middle, and some making a small amount.
Do you think the workers now would rather make a little bit of money or none? Assuming every current worker will just be converted to a full time employee with benefits is not realistic.
One might ask the question, why do these worker protections exist in the first place? There are good reasons. We've been undermining many things like this lately: vaccines, the EPA, anti-trust laws, voting rights. It will be our undoing.
I take issue with the word 'quietly'. The gig economy is pretty much designed to do an end-run around worker protections, starting off by denying the workers so much as an employment agreement.
The difference is all the more striking in countries that had above average worker protections in place. A large contributing factor here is that due to the internet's international nature it is very well possible that the enabler is in a jurisdiction that is entirely different from the one where the work is carried out.
Free-market fanatics see this all as a good thing but I'm really not happy with this rapid return to piece-work, which was outlawed in favor of hourly rates and minimum wages.
> Free-market fanatics see this all as a good thing but I'm really not happy with this rapid return to piece-work, which was outlawed in favor of hourly rates and minimum wages.
Piece work is making a comeback because of the failure of the alternatives. Insisting that we should keep on with the same rigide system despite its obvious failing is the real fanaticism here. Doesn't mean piece work should be the norm, it just means both have their place and completely outlawing one or the other seem like a big mistake. None of these two are going away as they are both needed.
The fanaticism is in employers hunting for ways not to pay for any time not directly coupled to revenue. With gig work, this is tracked down to the millisecond.
Only employers who have very low skilled workers do so, for two reasons, one is that skilled workers have more power to negotiate better deals, the other reason is that these gig companies operate on thin margins, in fact most of them operate on loss so every dime that can be saved is worth it. They only survive because they are subsidized by billionaires investors. Eventually most of them will either go bankrupt or find a way out of their loss at which point they will be able to increase their workers salaries (as it is a good thing for productivity and attract more talents). There's a lot of animosity against "evil employers" or "lazy workers" but it usually is a bit more complex than these simple dichotomies.
Are you seriously comparing 19th century piece work with today's gig jobs? Are you aware that classic employment is not being deprecated? People will simply choose what they like. Why should you decide for them? I know many people who are significantly happier and richer this way; who are you to deny them this happiness? BTW, IMO it seems like corporations are much more likely and empowered to abuse their employees than a gig economy platform ever could. Every Uber driver that had issues just switched to another platform or got an employment (situation when they can't get an employment and Uber is the only option is out of this topic).
Often it's not a choice: lots of people are layed off, and then rehired as freelancers. This is quite common among healthcare and construction workers.
This is all for the benefit of the companies, not the employees. Lower wages, no need to pay other benefits like health-insurance or pensions, and ability to end contracts as companies see fit, especially when people get sick, become pregnant, or just old.
There are a lot of freelancers forced into this construction, not by choice.
One of my biggest pet peeves about the current labor market is how my healthcare and retirement planning is so tightly coupled to my employer. Can we create a system where you're beholden to your employer for these things but I'm not? I prefer the gig economy.
> There's no way that can be off-topic; you yourself said "People will simply choose what they like." If other options are foreclosed, what then?
It is off topic because our democratic republics are saying in their constitutions that this public social responsibility is handled by them and therefore the corporations and people don't need to care, because of which you are forced to pay social security tax. Am I paying it for nothing?
BTW I live in a country that has stronger and person-based social system than the US. Other commenters have made points about insurance being tied to employment and I agree, in that case things are different.
This is a fair contrary point to raise. You can see its effect most clearly in the U.S. in the fear people have around health insurance, because it's so closely tied to their employer. (Which is also its own ball of problems, of course.)
If the US ever manages to separate the safety net (healthcare, basic living needs covered, retirement) from full time employment I can see the argument for a gig economy working. You may actually see "the market" compete for employees in a way that benefits them instead of how full time employment works today. Given the fact that corporations are far more effective at passing laws that benefit them vs. the American people, I'm not going to hold my breath.
This is a terrible way to look at it. If the labor pool is fractured into hundreds of millions of pieces, each acting in their own self-interest, how can you keep big businesses from exploiting them?
We'd just be back to the wild west of employment law pre-1880s, except without even the meager fallback of employment contracts, everyone would be at the mercy of the owners.
You might ask how that can be so - but one clear example, the market dictates these jobs do not provide benefits, that is their competitive advantage even. So how can a different company competitively provide non abusive practices?
I work for a good platform. It's name is Textbroker. The positive part is in the name: it's a broker. It provides a marketplace for writers to find work. It mediates the relationship between writers and clients.
I don't chase my pay. It takes me seconds to request my pay once a week.
I don't fight with difficult, unreasonable clients trying to screw me over. I let Textbroker handle them.
I have tried to promote their model as a good model. I have tried to suggest people should create businesses like it for other types of work.
Do you know how much an app "taxi" driver or an app food delivery person actually gets paid? (Also, it's not up to the person doing that to determine how much to charge)
The real problem, if you look at it from first principles, is the lack of US government protections/services for all workers.
If our government provided healthcare, eduction, a real pension program, non-terrible unemployment programs, etc. (as it works in most other developed countries) it would not matter if you are a gig worker or full-time employee. There would be no way to exploit you and gain a competitive advantage by hiring you as a contract worker. Companies and workers would be free to arrange employment simply around money and time. Benefits would not matter, and thus, the employment market would become more efficient.
The fact that US companies are wholly responsible for the quality of life of their employees is totally hilarious in a modern world where you don't work for the same company for your entire career. You can go from a 1st-world standard of living to a 3rd-world one simply by changing employers in the US. It's absurd.
> If our government provided healthcare, eduction, a real pension program, non-terrible unemployment programs, etc. (as it works in most other developed countries) it would not matter if you are a gig worker or full-time employee.
The issue with most of these things is that governments, especially the US government, are generally worse at providing things than competitive businesses. For people who actually have health insurance, outcomes in the US system are better than in most other countries, the US higher education system is generally considered one of the best in the world, etc.
The key is not to nationalize services, it's to provide a baseline of support. Pay everyone a UBI. Then if you need healthcare, you have money, go buy healthcare. If you want to go to school, go to school. You don't actually need the government to operate the school, and you especially don't need it telling people what to spend the money on. (See also student loans and home loan interest subsidies and the effect on education and housing costs.)
UBI is cargo cult finance. It's a broken mental model that will kill the system.
Money doesn't have inherent exchange value per se. It's primary value is in reducing friction in trade. Injecting more money into a system without tying it to injecting more goods and services into the system is a known means to fuel inflation.
A UBI doesn't create money, it transfers it. It's a generic safety net that provides a floor for how low income can go, so that nobody involuntarily goes without food or medicine but you also don't need the government providing services itself or ordering people to spend the money in a particular way.
> Injecting more money into a system without tying it to injecting more goods and services into the system is a known means to fuel inflation.
Right now people are paying for things on credit. If you give them the money instead of requiring them to borrow it, the only difference is that they don't have to pay interest.
But it could cause inflation in specific assets if the stuff the net recipients buy is different than the stuff the net payers would have bought -- which would be amazing. We're currently having a huge problem with central banks not being able to hit their inflation targets even at historically low interest rates. If we had something that could bring inflation up to traditional levels it would be a boon, since it would allow nominal wages to rise which is badly needed since everyone is currently saddled with unprecedented levels of mortgage, student loan and credit card debt and anything that could devalue the debt would be a major benefit.
If you give them the money instead of requiring them to borrow it
You are probably talking about the government borrowing it instead of individuals. This tends to not end well.
The money has to come from somewhere. If it isn't tied to creating new goods and services, then either you are basically printing more or taxing someone for it. Wealth transfer schemes are inevitably unpopular and tend to not work well. Schemes to "soak the rich" tend to get push back from the rich, who generally are in a better than average position to resist being victimized by the system.
>Wealth transfer schemes are inevitably unpopular and tend to not work well.
Transfer payments are used as an economic stabilizer along with taxation. They also pool risk. You'll need to back up your assertion since most economists see some benefit to transfer payments, and most developed economies use them.
> You are probably talking about the government borrowing it instead of individuals. This tends to not end well.
It tends to end with inflation eroding the debt. Which is exactly what we want in this case, ideally over time rather than all at once, but still.
> The money has to come from somewhere.
Why can't it come from nowhere? That's where the debt it's replacing came from. Banks don't actually have the money they loan you. They're only required to keep a small fraction of it in reserve. The rest of the money is created from nothing.
We're fundamentally in a position that we have to print a lot of money and cause a nontrivial amount of inflation because we already did that throughout the housing crisis and the response to it, allowing the prices of housing, education, healthcare and stocks to enter serious bubble territory. As a result of that either the nominal prices of those things have to come down or nominal wages and the nominal prices of everything else have to go up to reach parity with them.
But lowering the nominal prices of those things can't save the people who already paid for them on credit and now hold significant debt as a result, which is nearly everybody. Moreover, reducing nominal major asset prices tends to cause much more economic damage than raising the nominal prices of some other assets, because it causes people to default on underwater mortgages, hoard cash rather than investing it because the currency then appreciates in value, etc.
So inflation is good right now and printing the money would be a completely reasonable thing to do in the short term.
What happens after that is you pay for it from taxes, the same as the subsidy for [more specific program] would otherwise. But that should be a lot easier afterwards because real wages (and therefore real tax revenues) should be significantly higher than they currently are relative to the cost of necessities like housing, education and healthcare. In other words, the real amount of UBI you would need would decline with the real cost of those necessities.
> Wealth transfer schemes are inevitably unpopular and tend to not work well.
Then why do we keep passing/expanding rather than repealing various redistributive welfare and assistance programs?
UBI as such doesn’t imply anything regarding the source of the money.
My favorite scheme, f.ex, would rely entirely on a geoistic LVT-style dividend. The idea there is basically to capture externalities as rent, so no debt, taxes or money printing involved.
> UBI is cargo cult finance. It's a broken mental model that will kill the system.
Such dismissiveness is unwarranted. There's a lot of intriguing research on the topic that indicates that it may be a cost-effective replacement for the byzantine social support systems of modern governments, with benefits for both recipients and taxpayers. It only seems like a broken model if you /start/ with an overly simplistic model of the current situation, e.g one that ignores both the existence and desirability of social support systems.
Unfortunately much of the research is frustratingly incomplete. Search e.g. for information on Mincome.
It also seems like a reasonable transition mechanism, from the market economies that have brought us increasing productivity, to a hoped-for post-scarcity future.
The US health care system is the least efficient of all the developed world, in terms of results vs expense. In many sectors, a competitive market gives the best results. In health care, that's just not the case. The free market isn't the be all, end all solution that free market advocates want people to think it is.
First, US health care is hardly a free market. Second, the free market certainly isn’t a be all, end all solution. Most advocates of free market economics would agree with you.
It’s just simply better than any of the other solutions man has dreamed up so far, that’s all.
> The US health care system is the least efficient of all the developed world, in terms of results vs expense. In many sectors, a competitive market gives the best results. In health care, that's just not the case.
Interestingly, your example undermines your case, because the US system is also less cost efficient than systems that are more market-oriented than it is.
The US healthcare system is uniquely problematic. It's not a markets vs. socialism problem, it's a unique damage that arises from trying to do things at such a scale.
Everywhere else in the world it's things the size of individual US states doing healthcare regulation, e.g. a median US state like Oregon has a GDP larger than Portugal or Greece. In the US it happens at the level of the entire union, which screws things up something terrible because it's well past the point that economies of scale give diminishing returns but it grows the public and private bureaucracies so large that they have their own inertia and gravity.
If the only thing the US did was repeal all federal healthcare laws and hand the whole thing over to the individual states, it would probably cut costs significantly. And then California could have single payer and New Jersey could require employer-provided coverage and Wyoming could let the market handle it entirely and probably all of them would do better than the feds are currently doing.
I used to live on Poland and suffer from depressive disorders, my country has free universal healthcare but it didn't improve my depression and most docs felt as if they don't care and don't know what to do but since I've moved to states, bought private insecure and now undergoing treatment, my situation has vastly improved. People here seem to care more than they did back in home.
I don't like free healthcare because it often time can't even cover the minimum of what people need.
Many people who knew better went to Private Doctors even when we had free healthcare because they don't trust free healthcare and attitude of those healthcare provider. You end up wasting a lot of time in such system.
>The US health care system is the least efficient of all the developed world
On paper maybe. As a person who lived in Russia and lives in Germany I disagree completely. How do you measure efficiency? Healthcare workers are blatantly underpaid in many european countries, waiting queues are getting longer, and the next potential chancellor is literally suggesting conscription as a solution for medical personal shortages.
That may work with a system where the consumer has a choice. Basically clients don't and end up overpaying and getting the run around by private insurance.
Best is a balanced system with a mixture of private and public with public providing most of the infrastructure.
US life expectancy is lower than most northern European countries (plus Canada) or Northern Asian countries and costs are higher.
That said some EU countries like Switzerland have mostly private systems.
The only downside of government healthcare is generally taxes are added to unhealthy foods, tobacco and booze.
> The real problem, if you look at it from first principles, is the lack of US government protections/services for all workers.
This is so true. If traditional jobs (not gig economy jobs) were better, no one would ever accept a gig economy job. Traditional full-time jobs are required to give healthcare and other expensive benefits (that governments everywhere else provide), so those businesses have cut down on the number of full-time jobs.
The real comparison here is between big companies who refuse to offer full-time jobs and instead rely on limiting hours to keep most of their jobs as part-time. People who accept gig economy jobs do so because they can work more hours per week (not artificially held under 39 hours so their company can avoid paying benefits). Generally people are rational actors when it comes to accepting the best employment opportunity, so if we see lots of people accepting gig-economy jobs it means that their other alternatives are worse. That's not a defense of gig-economy jobs but instead points out that this is a problem for all workers and suggests moving to a system that the rest of the world uses to solve the same problem.
And likely because the full-time jobs pay terribly so they do gig stuff to supplement / make ends meet. And it’s something they can do flexibly around their full-time work schedule.
The reason that government supported healthcare is so difficult to sell in the us is that it drives down the cost of labor and the real constituency of politicians (campaign donors) prefer cheap labor.
If you're working on a gig platform, you're at the mercy of the platform itself. Since you aren't the paying customer, and the client is, platforms' incentives rarely inline with those of workers.
>It saddens me how this (to me) plain fact is left out of the debate about gig workers and their protections.
That's because it's no really a solution. If everybody is made into an "entrepreneur" or "freelancer" or "consultant", then those gigs get just as shitty as employee, but without the extra protections.
I think large parts of the gig economy don't even work as proper free markets. The free market is based around people comparing all options and choosing the best one for them. That works reasonably well for deciding to rent out on AirBnB, but calculating your effective hourly wage for driving Uber, factoring in fuel, wear and tear on the vehicle, variable demand, future uncertainty etc is really hard, especially in advance. And if it's hard that means some people will get it wrong. If enough people get it wrong in both directions the market price will drop below where it should be, because demand for labor will be satisfied by those who overestimated their effective salary. At that point you don't have a functioning free market, it's just companies benefiting from peoples lack of math and modeling skills.
There is another thing about free markets. They aren't run by one company. You have virtual monopolies in many situations such as Uber. Lyft barely factors in and two companies is not a market anyway.
If it was a proper free market then there would be lots of services like Uber that drivers could select from.
I still think that decentralized public platforms are the way to break the technopoly market strangleholds.
I'm not a free-market fanatic. I'm just someone trying to survive under circumstances where the world makes that unnecessarily difficult.
Gig work has been an effective antidote to otherwise impossible problems.
I wish I had a better life. I don't. Your attitude and assumptions are part of the problem for people like me.
The economy you are championing is one that primarily works for cis het white males. Women, people of color and other minorities were typically marginalized.
The erosion of worker rights by reclassification is not a panacea to discrimination. Removing these protections just makes it objectively worse for every employee.
You clearly seem to disagree but you haven't explained why not having rights has been an antidote to deep-seated social issues. I see no causation.
The only reason you are in that position in the first place is because you have few rights in the society you live in.
If not for that your situation would be much better. The United States is singularly bad at protecting basic rights for people who are less than lucky in life, the gig economy makes this worse, not better because it now seems like there is a solution: let those at the bottom of the societal ladder fight over scraps in a race to the bottom.
Of course from your position scraps are better than nothing but there are much better options available too. But they all start with a society where 'winner takes all' is not the default.
Unfortunately the export of the gig economy to parts of the world where the social safety net is working just fine has the effect of slowly eroding that safety net because there is less of a perceived need for one.
He's awfully opinionated about my country and my life without really knowing either topic well. I've spoken with him before. He assumes free medical care would solve my problems. He assumes I have huge medical bills because I'm American.
It's not true. I've basically been a military dependent my entire life. I've always had free or nearly free medical care. It's part of why I'm alive at all.
There are a lot of other issues with his assertions that I wouldn't know where to begin to address and trying to address them at all looks to me like social suicide for various reasons.
So thank you for the sincere and respectful inquiry, but it isn't likely to go anywhere good to try to answer it in earnest in a substantial manner.
> He's awfully opinionated about my country and my life without really knowing either topic well.
I've lived on the US/Canadian border for 7 years and know the United States quite well, probably I have more friends there than I do here in Europe.
As for your life, you've spent years on HN educating everybody here on it in minute detail so if you want to make the case that I don't know anything about it then I suggest you read back your own comments and associated blog posts. I know more about your life than I know about my sister's.
> He assumes I have huge medical bills because I'm American.
My comment had nothing to do with your medical bills or lack thereof, and - given your comments to date - I would rather assume that they are low.
So to me it looks like the assumptions are all on your end.
On another note it is rather rude to answer to a comment thread and then to berate an earnest reply in this way.
FWIW: you're one of my favorite commenters on HN and you're in the list of my comment-updates-telegram-bot. I also find there's an odd tension at times in DoreenMichele's comments when it comes to the 'free market'.
That said, I really wish you'd keep out of these kinds of spats, and/or have the wisdom to know what might trigger or exacerbate them. I could see this one coming a mile away the moment I saw 'jacquesm' replying to 'doreenmichele'. Even if she 'started it'.
And that said, my apologies for inserting myself in this conversation :). I wish you both the best, hope you can find common ground, and enjoy your contributions here a ton!
Wouldn't increasing the availability of work do more to increase worker protections than regulations increasing worker protections. As employers compete for workers, wouldn't that create a system of protection for workers. I mean lets face it - the only real power in any negotiation comes from the power to walk away from the bargaining table
>Free-market fanatics see this all as a good thing but I'm really not happy with this rapid return to piece-work, which was outlawed in favor of hourly rates and minimum wages.
Funny thing is that US has minimum wage and til recently had mandatory union participation. Sweden has neither. Yet, Sweden has a much better working conditions and more free market.
It's quite funny to observe US people got used to crony capitalism blaming free market for bad working conditions.
Labourism is doing better under free market, you just can't into labourism, that's the problem. When Britain abolished mercantilism in favor of more laizes-faire policies in mid 19th century, the labourism flourished, and the working conditions (which were nearly stagnant in the previous 50 years) improved dramatically.
Regardless the regulations you would impose you wouldn't have good working conditions until you achieve basic consciousness. Labourism is not about regulations, it's about consciousness.
Otherwise there would be a few in power dictating to the many, and it doesn't matter if these in power would sit in the governments or in corporations.
Universal health care would drastically improve the situation by removing a big percentage of the competitive advantage of gig companies.
More generally, regulation is needed that removes all financial incentives to prefer gig workers and contractors over full time employees. This would be good for both gig workers (better benefits), and full time workers (less wage pressure from competition from workers with unsustainable compensation).
The way universal healthcare is implemented in Germany, it does not undermine the gig economy by itself. Freelancing where the employer does not pay for healthcare is still possible and also removes the need to pay minimum wage.
It comes down to stricter rules around employment. Gig-Employers are risking to get sued by there defacto employees and them being granted employment status, which then makes them entitled to receive minimum wage, healthcare, pension payments etc. even in hindsight.
So a "gig" has to be exactly that, it cannot be an actual job.
To elaborate on this: In Germany if you are a contractor but all your contracts amount to effectively working like an employee for a single company it can be ruled that you are an employee. There are obviously exceptions, like seasonal work, and the system can be gamed. But trying to game the system means you can't keep your good workers because you can only contract them for so long before offering employment.
Is there any gig economy app that simply creates a marketplace (like Craigslist)? This seems like it would be far preferable, because otherwise you're just asking people to be an employee without any employee protection.
In a marketplace system, these people aren't employees; they're owners of their own business.
I disagree. Task Rabbit places demands on their providers, such as requiring them to respond within a particular time frame. If any such demand is placed on you, you are an employee.
A big part of the point of a marketplace of contractors would be to do some form of vetting. Contracts can have standardized terms. People may want insurance or other protection. Contracts are more than just "X pays Y, Y does work for X".
A marketplace making a requirement that contractors on their platform must respond to messages within N hours doesn't inherently make the contractors into employees. "We don't list people unless they meet these requirements" serves as a major selling point. "We list anyone who shows up" makes for a noisy, lower-value marketplace.
> The gig economy is quietly undermining a century of worker protections
An economy is an inanimate object; it can't #{active_verb} something. This may sound nitpicky, but: language carries meaning; language influences perception; and, in this case, language ascribes blame.
Insofar as Ameirica is concerned, the contractors working for gig apps, like Uber or Postmates, have chosen not to exercise their rights to worker protections. Even as contractors, giggers have a legal right to unionize, collectively bargain, and form a cartel to demand better compensation. These people have chosen not to.
That's not to say organizing is "easy" -- especially when you're living paycheck-to-paycheck -- it's not. But, to the degree that contractors are upset enough to act, organizing is feasible and achievable.[1] Self-organization is the free-market solution to a person feeling exploited or trampled upon by his boss. No government intervention is required.
Given that the right to exercise collective bargaining is a choice, and afaik the majority of giggers do not collectively bargain, the rational conclusion is that these gig contractors aren't upset enough about the terms of their gig to take action.
Blaming the victims.Call it what it is what it has all way been, people with advantages taking advantage of people and then blaming them for being them. Nothing new.
An economy is an inanimate object; it can't #{active_verb} something. This may sound nitpicky, but: language carries meaning; language influences perception; and, in this case, language ascribes blame.
> the contractors working for gig apps, [...] have chosen not to exercise their rights
It's sad to see this sort of propaganda on HN.
Gig workers choose to take up a gig job in alternative to starvation, in most cases. There are big socioeconomic problems undermining the misguided notion that it might be a rational choice, in the overwhelming majority of cases.
This is why the State, in a modern society, is supposed to step in and forbid employers from taking advantage of workers.
These are lessons that were first learnt in the XIX and early XX century.
> Gig workers choose to take up a gig job in alternative to starvation
Would like to see a source on the claim that Uber drivers' only alternative is starvation. Uber has been founded in 2009, I am old enough not to remember mass starvation anywhere in the US before that. I am also vaguely aware of something called welfare state in the US that collects massive taxes exactly to prevent people from starvation (among other things), and I don't remember - before 2009 - any claims that this system has failed so much that people are suffering starvation in the US on the massive scale, or were until Uber came along to rescue us.
Moreover, to work for Uber, you must have a car (and a driver's license). Not just any junker clunker car barely moving around - a relatively nice car that a passenger would be fine with sitting it. Usually people literally starving do not have those, I think. In most cases.
My personal experience with Uber drivers (and other gig workers, like TaskRabbit or Fiverr) also does not match the description that they were starving before they had this job. Of course, this is only a personal anecdote, so I would very much like to see your source to that claim. Though I suspect you do not have one.
While it's not literal death from starvation, it's as close as you'll get in a country with agriculture subsidised in the way that it is.
That's not to say it's as melodramatic a situation as maybe the word 'starvation' presents itself, but do not delude yourself; people really are actually poor in real life. It happens. A lot.
Sorry, I can't believe you compare nutritional disbalance (which is caused, in part, by abundance of cheap available calories in cheap available foods with ) with actual starvation. Yes, common American diet is nutritionally unsound (and government meddling for decades using bad science carries serious part of the blame, agro subsidies do too) but this is radically different from not being able to afford any food at all. I can't believe this needs to be spelled out.
> people really are actually poor in real life. It happens. A lot.
Who you are arguing with? I never claimed there are no poor people in real life. What I said that Uber drivers aren't doing it because their alternative is starving. Most people who are really poor do not participate in the gig economy at all.
There is no need to be disingenuous, you know very well what I meant.
Gig workers, at least in the UK, are overwhelmingly from minority and disadvantaged backgrounds; they don't do it out of choice, but because they have little or no alternative.
> to work for Uber, you must have a car
This is the same as for regular taxi work (there are various arrangements, but in most cases drivers end up paying for their vehicle one way or another). In fact, Uber lowered requirements since you don't need a specific type of cars (like UK cabs) or paint jobs/registrations (in most countries). And that's why it got popular: it lowered standards even further, in a sector already predominantly staffed by the worse-off.
> My personal experience with Uber drivers [...] also does not match the description
Of course; they want your five stars, they'll all try to look and sound happy and successful - not unlike many entrepreneurs.
> they don't do it out of choice, but because they have little or no alternative.
If they have no alternative, that means removing these jobs would leave them with literally no income at all. How can anyone think it's a good thing?
> This is the same as for regular taxi work
No, it's not, at least not in the US where taxi medallion (completely government-imposed cost) could cost over a million before Uber, and even now can cost hundreds of thousands. Uber medallion costs $0 - they give you the windshield decal for free, as I heard.
> In fact, Uber lowered requirements since you don't need a specific type of cars (like UK cabs) or paint jobs/registrations (in most countries)
And that's bad because it allows those with no other alternatives to earn income access these jobs without impossibly high upfront investment, which also allows to better serve customers, which is obviously bad because.... ? I can't finish this phrase.
> Of course; they want your five stars, they'll all try to look and sound happy and successful
And that's bad because... ?
Anyway, you can't be starving and dirt-poor and "look" an owner of an upscale Mercedes - you'd need the Mercedes at least. You can't just "look" like having one - you have to actually get one.
> The disruption offered by the "sharing economy" is simply a hustle.
I would say "an evil" rather than "a hustle." Paying a few programmers six figures to write an app that commands lots of other people to work for less than minimum wage as "independent contractors" is evil. Calling it "sharing" or "tech" doesn't make it smell more sweet. Labor laws may not be perfect, but they have been built from centuries of experience, and sometimes blood[1,2]. It's a shame to see them being successfully ignored by a handful of morally bankrupt programmers.
They were not employees and so had no health insurance
The gig economy casts light on the fact that America fundamentally fails to take care of its citizens in this important metric. Gig work would be less problematic in the US if we didn't expect employers to provide healthcare.
My life works at all when it shouldn't because of gig work. There are myriad issues making my life challenging, from serious health issues to sexism and classism. I get aggravated when I see people who are part of the problem in that regard vilifying the gig work that has allowed me to survive, problem solve, get back into housing etc.
Certainly, there are abuses. We should strive to make gig work a more positive thing generally.
But we should also strive to not throw the baby out with the bathwater.
Before Uber/Lyft existed, I never took a taxi. It was just prohibitively expensive compared to buses/walking. If Uber is forced by the government to provide all drivers with a living wage and health coverage, I imagine I'd immediately stop using the service since it would become prohibitively expensive again, just like the old system.
I'd rather prefer a society that values someone being able to live comfortably of their work over you being able to get a cheap taxi with the least amount of effort.
If you read the theories or Karl Marx, his theories are pretty accurate in terms of explaining why people work "gig jobs" even though worker protections are basically non-existent. Marx basically described a class of people as being the "industrial reserve army of the unemployed"...obviously these are people who are either unemployed or unemployed. For these people, they are basically going to fight for whatever job they can get because having a terrible job is better than no job at all. Thus, as long as this class exists, people will work terrible jobs without much ability to fight back. It is also important to note that the industrial reserve army of the unemployed exists for each relevant skill set. For obvious hard to get skillets....the reserve army is basically non-existent. It also explains why all of these "gig economy" type startups almost entirely focus on services that are low-skill by nature.
If Uber drivers are supposedly all unemployed and so poor they have to grab any terrible job they can find, how can they afford those nice cars I'm seeing? I am employed in high-tech and I've been in Uber cars better than mine numerous times. People driving didn't look desperately hungry either.
I heard of debt. I actually made and paid off some. Turns out, those debt distributors (some people call them "banks") actually care about getting their money back and require proof of income and employment before they give you that sweet debt.
It undermines protections but allows execution of projects that wouldn't otherwise be possible for such a small budget. My company would not exist without the Fiverr contractors i paid early on, hiring devs was a no go. My fiverr devs are efficient and they all negotiate their rate. My specs are clean and actually complete enough to deliver working code that I hook into my existing platform. I'm pretty sure the fiverr devs I pay are making more per hour than they would full time. One difference is that they probable dont have time to bullshit with coworkers or surf reddit half the day.
What we are having here is an experiment. There are two classes of jobs, which provide nearly the same service - e.g. driving people from one place to another. One set of jobs has "century of worker protection", the other does not. People seem to flock to the second one, even though it requires certain level of investment and skill (owning a car, knowing how to drive, having reasonably clean driving record, being personally nice to clients, etc.) and offers no guarantees. Moreover, they don't just lukewarmly think about maybe trying it out - they rush to do it so eagerly that companies organizing it make billions, despite all efforts of various governments to suppress and limit their business. It looks dangerously like something people want to participate in...
The obvious conclusion that people seem to be making in that the second class of jobs is evil and must be destroyed, and only the first class of jobs - clearly leaving a huge unsatisfied need from both producers and consumers of the service - should be allowed to exist.
Worker protections are expensive and come with industry regulation. Corporations have figured out that they can simply shift their business model to the "second class of job" and ignore regulations and worker protections. The companies organizing it rake billions while the workers make less than a living wage and often rely on public subsidies to survive, which is effectively a subsidy for these corporations who rake in billions off the backs of these workers.
If you ban these jobs, would people that subsist on job+subsidy consume more public subsidies or less? Note that you assumed these people are very poor and have no alternative jobs. Now you have taken away their only (albeit low) income they had. Would it lead to consuming more of public subsidies or less? Would absence of taxes paid by corporations make providing these subsidies easier or harder?
I wonder if they’ll make a non-immigration visa for gig workers similar to the seasonal farm workers program... basically let the current farm workers have the option of driving a taxi instead. Just require that they only work half the year and go back to their country for the other half (stay seasonal).
> Here is the thing about Uber and Lyft (and much of the “sharing economy”).
> They don’t pay the cost of their capital.
> The wages they pay to their drivers are less than the depreciation of the cars and the expense of keeping the drivers fed, housed, and healthy. They pay less than minimum wage in most markets, and, in most markets, that is not enough to pay the costs of a car plus a human.
> These business models are ways of draining capital from the economy and putting them into the hands of a few investors and executives. They prey on desperate people who need money now, even if the money is insufficient to pay their total costs. Drivers are draining their own reserves to get cash now, but, hey, they gotta eat and pay the bills.
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[ 2.8 ms ] story [ 230 ms ] threadThat’s about 300% of the federal poverty line. Under the ACA, they can purchase health insurance on the exchanges for a premium that is capped at 8-10% of their income.[1] In Germany, a self-employed person would pay 15% for mandatory state health insurance premiums. (People who work for a company pay half of that, with their employer paying the other half.)
Here in Maryland, a quick search of the ACA exchange shows a Silver Kaiser Permanente plan for $266 per month (subsidized) for a 35-year old single person making $35,000.
"Pay Per Month: A median of $155 per month and an average of $364"
Then, there's that "pay" isn't "pay". These are gross numbers rather than net.
"The actual expenses of driving, like maintenance and gas, consume about $4.87 per hour of a driver's income."
And we wonder why our healthcare costs are so high...
We have spent 28 trillion dollars on welfare, yet the poverty rate is unchanged over decades. The only thing that supports people is work, and we need to eliminate as many impediments to it as possible: over-regulation, payroll taxes, income taxes. Make huge cuts to welfare with the savings and streamline healthcare to provide cheap, basic services to every citizen (in line with disallowing citizenship by birth).
Then, regulate the supply of labour by barring immigration from poor countries (establish a liberal visa regime with countries in the HDI top 30 though, to allow legitimate talent to come to America). You have the recipe for a reasonable, modern life for any American willing to work. It could be a blueprint for the whole Western world.
Your manifesto doesn't include these things, why not?
Already covered that.
We can pay for healthcare for all citizens, but it will mean excluding very expensive things like heart surgery, cancer treatment, joint replacements. We will probably need to be much more forward on euthanasia for the old, to save resources.
We can provide free higher education, but its going to mean no student housing, no athletics programs and restricting college to the top 20% of the cohort academically.
Why should we have to tax the current worker population in order to pay for old people to do nothing? The current retirement system is a flawed ponzi scheme. People have continued to work until death or impairment in the past - why should retirement be considered a human right now?
Cut payroll taxes and income taxes, and the elderly can happily work 1-2 days per week, and businesses will be happy to have them. Store clerks, fast food workers, cleaners, child carers. These jobs can be done well by the elderly, and work keeps the brain active and healthy.
What if I want to work part-time throughout my life, and never retire? Shouldn't I have the ability as an individual to decide how and if I want to retire?
This is not really accurate. Unemployment is at a 40 year high. (where "unemployment" means "percent of working-aged people without a job")
https://www.theatlas.com/charts/B1SUWjSx7 (that big drop is people losing their jobs). The last time the numbers were this bad was back around 1979.
For example, if jobs get better, then families can live on one income. This is good. We're still way above the workforce participation of the 1950s, which generally was a better time for family life in the USA.
Regardless - I haven't seen any evidence that we are returning to a general viability of supporting a family on one income, at least supporting it well. Do you know of any?
This has been going on for decades---I can remember complaints about UPS, etc., delivery employees being replaced by contractors, and I've worked for places with the infamous 19.5hr/wk schedule.
There are two things going on here that makes this more complicated that meets the eye. For one, as you have pointed out, lowering the price of labor increases the number of things people would be willing to hire someone to do, thereby increasing the number of jobs. However, it's also true that by removing the protections for one specific form of labor but not all, gig economy companies will have a competitive advantage over classical employment companies and put them out of business. So, the gig economy is reducing the number of "classical" jobs.
These effects point in opposite directions, and without being able to put numbers on them there's no way judge which wins out. Measured in terms of "money paid to low-skill workers," the reduction in everybody's wages might or might not be offset by the increased number of jobs, an increase which has been attenuated by the gig economy replacing some of the old economy.
https://www.forbes.com/sites/carriesheffield/2014/04/29/on-t...
Should workers be able to unionize to demand better from their employers?
The free market is the best (or less worse) system at giving people a wage as high as possible compared to socialism. Now, we're talking very low skilled people who can't seem to get a job anywhere, in this case, increasing barrier to entry only makes things worse. Given that most jobs require skills, most jobs are paid above minimum wage thanks to free market competition so no race to the bottom would happen in most case and even then the market would fix a limit (ie no one would accept your offer if it's too low, same reason no one in SV would accept an offer below $100k ;).
> Should workers be able to unionize to demand better from their employers?
Absolutely, there can't be a free market without freedom of association.
Unions by definition will increase the number of protections for workers and increase the costs of labor.
Personally I take an opposite stance: the problem with the free market is that it has to optimize for infinite growth. It doesn't matter if you make profit, you have to make the most profit or you're a failure. Which means removing insurance for workers, minimizing wages, maximizing unpaid overtime etc. The free market is fundamentally at odds with workers and that's why companies employ lobbying and union busting behavior.
Have you ever ran a company? Most people running a business care about all these things you're enumerating and no one believe in infinite growth.
Now yes, of course capital is going to seek the locality with the cheapest costs of production, so there is a tension between competitiveness and ensuring a minimum standard of living. Cities, states, countries, ultimately have to work together to balance these demands.
If your solution to all of this is a laissez faire system that relies on the fact that "most people care"... it is I that has to question your naïveté.
This is only true insofar as the market is inefficient.
Suppose you have a free market for car services (i.e. no taxi regulations or similar) and the drivers all get together and unionize. They demand higher wages and get them. The only way the company can pay higher wages is to raise prices, so they do, demand for car service is reduced, and some of those people lose their jobs.
Since they're no longer employed, the people laid off quit the union. Car Service Number Two shows up, has no contract with the first car service's union, pays the original lower wage to the people put out of work, and attracts customers by charging lower prices. That causes Car Service Number One to lose business and have to lay off more drivers who then go to work for Car Service Number Two, and so on until everyone is working for Car Service Number Two. If they then unionize again, Car Service Number Three appears to hire the workers laid off due to the higher wage ad infinitum.
Which is why unions don't work in competitive markets.
> the problem with the free market is that it has to optimize for infinite growth.
There is nothing that requires this. What it needs to optimize for is efficiency. If you're paying $50 then you have to charge >$50 and you lose business to the competitor who pays <$50 and then charges <$50. But at scale this isn't a problem -- when everything you buy costs less, it isn't a problem that you get paid less.
The problem now is regulatory costs and cost disease preventing the lower prices from actually happening in many cases. But you can't fix high regulatory compliance costs by increasing regulatory compliance costs.
People who are laid off don't just quit the union; unions often offer additional support for members who are laid off including aid for job seekers. A great example of how unions exist in a competitive market is SAG-AFTRA which by your own argument simply shouldn't exist. If you're going to make an argument against unionization, you shouldn't take one that can be empirically disproven.
What kind of job seeking assistance are you imagining in a car service union? The services themselves already tell you when work is available automatically and the problem is that there are more workers than there are jobs at the higher wage.
Moreover, if you're going to offer things like that then you have to gatekeep union membership and then your problem isn't that people quit the union, it's that they can't even get into it if they wanted to, and would then happily take any non-union work they can get.
> A great example of how unions exist in a competitive market is SAG-AFTRA which by your own argument simply shouldn't exist.
It shouldn't exist if Hollywood is a competitive market. But it isn't. There are a handful of major studios that make substantially all of the major motion pictures and control the major channels of distribution and promotion.
Before the internet it was effectively impossible to strike out on your own as a high grossing studio. It's still extremely difficult using traditional channels. What we're seeing now is individuals doing it using platforms like YouTube -- but they're hardly making anything like what Hollywood does and the various YouTube celebrities are generally not SAG members either.
I think you are right. Unions are by definition all about a (a kind of external) negotiating power. Such things have no place in ideal and fully efficient free markets where the prices are dictated solely by the demand and the supply.
Either such a market would be robust enough (as in your example) and the union would not be in a longer term viable, or the union would be viable (e.g. some kind of monopoly) thus turning the market into a non-ideal, non-efficient and non-free.
However I am yet to see (or realize that I see) a labor market that would be in any meaningful way close to being efficient and free. The labor markets I see have low liquidity (it is difficult to search and change the work, it takes time to adjust your skills), huge information asymmetry and low transparency, and the most actors are not very "free" (debt, no alternative options...).
Airlines form their own sort of union. (we might call it a cartel) They decide to agree on prices instead of competing. Prices double.
Fueling stations do likewise. They agree that gasoline should be $12 per gallon.
Cell phone providers decide that you should pay $1 per megabyte. They all agree, being in their union, that they won't work for less.
Good?
[1] https://toddwschneider.com/dashboards/nyc-taxi-ridehailing-u...
> Before Uber entered New York there were ~500k cab trips per day
This is not a good argument as Uber & Lyft are not yet making profit and in general you cannot compare both numbers as ridehailing grabs trips from public transit:
https://sf.curbed.com/2018/7/27/17622178/uber-lyft-cause-tra...
https://www.businessinsider.de/uber-lyft-having-devastating-...
Not to talk about the negative effects of their growth: http://www.schallerconsult.com/rideservices/automobility.htm
Sure, but the gig economy started from displacing jobs that were caught in regulatory capture. Most of the people that the earlier post talked about wouldn't be able to get a job as a taxi driver due to regulations. I think that, so far, the gig economy isn't pushing heavily into areas that aren't suffering from regulatory capture.
Delivery drivers have been moved from secure employment to the gig economy and enforced self-employment. Uber drivers would previously have been taxi or private hire drivers.
The problem comes when, after a few months, many realise that the gig role they took simply doesn't pay. Or pays significantly less than minimum wage without rights and benefits that everyone else in the economy takes for granted.
For the most part it's simply a way of larger companies outsourcing part of their labour costs to the state (via top-up benefits).
Let me go out on a limb and say: who gives a shit that there’s now more demand? This is not a good thing, demand for Uber is often replacing demand for public transit and bringing with it additional congestion[1], pollution, and waste in the classical “broken window” style. This is economic growth for the sake of itself - not towards any kind long term prosperity for the human race.
[1] https://digitalcommons.hope.edu/curcp_16/147/
Though not in real costs
Outsourcing with maybe a dash of mass immigration made them unemployable, not workers protections.
Let's not pretend like this is some accidental outcome of well-meaning measures. This is the desired result of deliberately implemented policies.
My mom used to work two jobs in the early 2000s, and it was always a struggle because so many retail jobs (or at least retail managers) will intentionally randomize schedules, such that even if you are working 30h/week you can't hold another position because in any given week the schedules are likely to overlap. The gig economy is a weaponized response to this variability IMO.
So, let's imagine all wishes of Uber opponents came true and Uber doesn't exist anymore. What does it mean for that "someone" - back to "no work at all", right? Do you think that change improved his situation?
> so many retail jobs (or at least retail managers) will intentionally randomize schedules
Why? What advantage does it provide to them? Also, isn't retail job the very one that has centuries of protections and, as the topic article claims, must survive and serve as a model while Uber jobs must be gone?
That's part of the Under-employed crisis in the US. When people talk about worker protections, they're not talking about part-time work.
Additionally, very few full-time employees have anything remotely like a randomized schedule. The medical industry is the only industry AFAIK that resembles randomized schedules at all. Yet this is VERY common in part time work.
Let's imagine, again, the wishes of the progressive forces came true and the part-time jobs are banned forever, together with gigs and side jobs and contracting and interning and whatever it is that is not 100% full-time fixed steady job - all other ways to get employment is verboten. Would you think people that are now working part-time jobs would be better or worse off? If, say, someone is a mother working part-time because she needs time to take care of the kid (and she doesn't mind giving up vacation time for being able to actually spend time with the kid when she needs it) - would she better off losing the part-time job or being required to work full-time and hire a full-time (remember, no part-time jobs anymore!) nanny or give the child to the mass-warehousing facility for kids while she is working? Would the person who has a side gig because his main job does not provide enough income be better off losing that gig? Would we be better off is we solve the crisis by destroying the part-time employment?
2. If you have 10 employees, late shift only twice a week, only 3 of them are trained to open the store, and employees constantly swapping hours, it can be hard to provide consistent hours for everyone. "Intentionally randomize" could have been restated as "regularly unstable"
I think the fact that people can drive 15 hrs a week if that fits their childcare schedule or drive 60 hrs of week to pay for a vacation is incredibly valuable.
People raising kids might love to work a couple days a week a couple months of the year (to match the school schedule).
Many of them would never consider a 9-5 FTE job.
Part time employment with flexible working hours is a good thing, but that's not a benefit that the gig economy delivers, in fact quite the opposite.
An unregulated wage economy suppresses wages to the point that workers must work ever increasing hours to make a living wage. If that stops being the case, there will be someone willing to work a little longer for a little less. This feeds into a cycle where wages are suppressed right down to the point where to make a living wage you actually have to be working all the time.
Far from gaining control to "set your own hours" you actually get pressured into more and more hours.
Contrast to regulated industries where you are either salaried, or supply is restricted so that workers can genuinely earn and set their own schedules without feeling like they'll lose out by taking any breaks.
Describing the gig economy as some kind of workers' nirvana is just deceptive and wrong.
That sounds like trying to use the gig economy to make a living. I'm sure some people could do it, but it's hard like you mention.
The gig economy is designed for short, flexible gigs to supplement your income not replace it entirely. The people that are trying to make a full income entirely from piecing together tons of small gigs I'm sure are struggling because that's not what it's claiming to do. It's primary function is flexibility, not keeping up with the Joneses.
FTE is for building wealth, the gig economy is for flexibility. The gig economy filled a much needed gap for people that only want to work a few hours a week or like variety in their work. It's not supposed to be the cure to fill time employment, just an alternative.
It's like complaining that a "tiny house" isn't big enough. It's not what it was designed to do.
When gigs represent an ever-increasing percentage of the employment available and steadier work is becoming harder to find, how are people expected to make a living?
With a contractor, or a gig, you can define a single project price or hourly rate, sign a short contract and get down to work.
Also, software development as a discipline is filled with highly (and formally) educated people. A lot of the non-traditional (non-computer science) developers at least come from a math/science/engineering background. Even if you have the skills, these people will not allow their ranks to be sullied by the "unwashed masses" who didn't "work as hard" as they did. (Quotations to indicate these are not my personal thoughts, but I am not quoting a specific source).
Let's imagine a large bank that closes down 1000 branches with 10 employees each, due to online banking becoming more prevalent. Does this mean that the bank suddenly (or ever) needs 10,000 extra developers working on their online banking? Not even close!
I'm sure that many HNers will try to claim that I am a bad programmer or something. I believe the reality is that a large portion of the market for software engineers just doesn't have a lot of resources and so is looking for ways to save money. Not dealing with benefits or even minimum wage is a way to do that.
HN likes to think that low paid or non-benefit work for software development doesn't exist. It is a huge global industry in fact.
This is a great thing and I’m not sure what all the hate is about.
But the reality is that established fulltime jobs are being supplied by "the gig economy" creating a class of worker who previously would work full time but now work similar jobs doing mostly similar hours but without the protection they previously had.
If full time jobs are being replaced by ZH contracts to fill the same role, it's not workers' who benefit, it's companies.
* Care home assistants and other social care
* Retail staff
* Food manufacturing
* Farm labour
* Package and food delivery
* Food service industry (restaurant staff)
And many, many others.
Most of the gig economy is not facilitated through tech companies and apps like uber or deliveroo but instead managed and provisioned through outsourcing companies.
Huge swathes of the low-knowledge service economy have been replaced by these zero-hour contracts which characterise the "gig" economy. The workers have a very asymmetric relationship where the work-provider is generally free to offer or not very short-term contracts or 'gigs' while the worker is generally pressured to accept everything else risk being effectively black-balled by the work-provider.
This is typically all done through a third party provider and further increases the 'distance' between the worker and the actual service being provided. This has really damaging long term effects for both the worker and the business.
Outsourcing isn't particular new but the rate at which 'zero-hour' contracts and the wider gig economy has been alarming. It has gone from less than 1% to double-digit percentages of workers in some sectors on ZH contracts.
I believe that any such outsourcing is damaging, a worker who works for (and not even employed by) a third party outsourcing company is unlikely to feel the same pride than a direct employee, but more concerning is that domain expertise is not kept and nutured within the company but instead diluted. There is less opportunity for knowledge sharing across domains if different job roles within the workplace are not just siloed but actually fulfilled by different outsourcing companies. Having a sense of shared ownership and an opportunity for casual knowledge sharing between different parts of a business is essential for 'eureka' type moments to bring breakthroughs in improvements to ways of working or problem solving.
In the outsourcing model people are seen a merely a resource to be managed. It doesn't matter who is turning up to do that role as long as someone does.
Zero hours and the gig economy stretches this to breaking point. Both ends of the equation lose stabilty. The business no longer has stability of knowing which employees will be around next week, so is therefore less likely to invest in upskilling, and the workers don't have the stability of knowing if they'll be offered any hours the following week so lack the stability to make long term decisions.
The accountants back at head offices of course see it as a win/win. The busiess, e.g. a restaurant no longer has to worry about whether they'll have to recruit for staff at short notice because of high turnover, because it's a different company's problem to find and supply the staff and the reduced risk that brings, and not directly employing staff reduces the overhead of managing payroll or even if they are managing the contracts reduces some tax overhead (e.g. employers NI contributions).
You might not recognise this as the 'gig economy', especially if you work in an "at will" state in the USA, but in the UK these zero-hour contracts are a large part of what we see as the gig economy because it differs so much to the established rights that we enjoy as employees.
In fact legislators worked hard to establish new "workers' rights" to increase rights for workers without needing full employee rights so workers at least get some protection.
All of this also contributes to lower social mobility. The ability for someone to climb up from the lowest 'rung' of an organisation was a rare but treasured part of corporations. Many older companies have such stories as part of their folklore. But in the outsourced gig economy, what were the bottom rungs of the ladder are no longer ...
I was looking for temp jobs recently, and I went to an interview for a mailroom job. I thought of the cliche of the mailroom employee who works their way up to CEO, and when I got to the interview, you guessed it - I wasn't interviewing with the company I thought I was, but a contracted provider of services in the same building. So, no CEO potential.
I also used to work for a division of a Fortune 500 company and noticed that the janitors were, again, outsourced and not employees of the company.
Something I don't see you mention, though, is that governments are taking advantage of outsourcing too. I am in fact working for a state government at the moment as a temp. I'm basically doing the same thing as an employee would, but without the civil service protections. There may or may not be opportunities as a result.
I also don't see it replacing anything. Every company isn't going the gig route. It's just not practical.
"They were not employees and so had no health insurance, workers’ compensation protections, employer contributions to Social Security and payroll taxes, paid time off, family leave protections, discrimination protections, or unemployment insurance benefits"
This was never part of the deal. I don't get any of this selling my items on Ebay either.
"Sometimes, this gig work also requires an initial outlay of capital. (My own neighbor just traded in her old vehicle for a new car, taking on thousands of dollars in debt so that she can make extra money driving for Lyft."
So no actual research before diving in and buying a new car? Not a smart move and not Lyft's problem.
"Platform algorithms are designed to downgrade those who aren’t always available, making it ever-harder to pick up gigs"
As a Lyft customer, would it make sense to have someone pick me up that may not even be there? That would be a horrible customer experience.
"Uber, for example, offers email communications to drivers, a service that is not nearly as responsive as the taxi cab dispatcher, say"
Was this article written by the Taxicab unions? You can regulate and force companies like Lyft to make all of the drivers employees, pay them a good wage, and give them benefits. But, this will cut the workforce significantly because the bar will be much higher to become a driver. Many of the people driving now will be out of work.
“The disruption offered by the sharing economy is simply a hustle.”
It really depends on your goals. The gig economy allows more people to make less money. Just like any market, there will be a small percentage making the most money, some in the middle, and some making a small amount.
Do you think the workers now would rather make a little bit of money or none? Assuming every current worker will just be converted to a full time employee with benefits is not realistic.
The difference is all the more striking in countries that had above average worker protections in place. A large contributing factor here is that due to the internet's international nature it is very well possible that the enabler is in a jurisdiction that is entirely different from the one where the work is carried out.
Free-market fanatics see this all as a good thing but I'm really not happy with this rapid return to piece-work, which was outlawed in favor of hourly rates and minimum wages.
https://en.wikipedia.org/wiki/Piece_work
Piece work is making a comeback because of the failure of the alternatives. Insisting that we should keep on with the same rigide system despite its obvious failing is the real fanaticism here. Doesn't mean piece work should be the norm, it just means both have their place and completely outlawing one or the other seem like a big mistake. None of these two are going away as they are both needed.
This is the oddest definition of viability I've ever seen.
This is all for the benefit of the companies, not the employees. Lower wages, no need to pay other benefits like health-insurance or pensions, and ability to end contracts as companies see fit, especially when people get sick, become pregnant, or just old.
There are a lot of freelancers forced into this construction, not by choice.
How many other platforms are there? How different are they?
> situation when they can't get an employment and Uber is the only option is out of this topic
There's no way that can be off-topic; you yourself said "People will simply choose what they like." If other options are foreclosed, what then?
It is off topic because our democratic republics are saying in their constitutions that this public social responsibility is handled by them and therefore the corporations and people don't need to care, because of which you are forced to pay social security tax. Am I paying it for nothing?
BTW I live in a country that has stronger and person-based social system than the US. Other commenters have made points about insurance being tied to employment and I agree, in that case things are different.
It's specifically because we draw income from one company that they have leverage to abuse us.
It saddens me how this (to me) plain fact is left out of the debate about gig workers and their protections.
I think employee protections are crucial, but I think the notion that gigs are abusive in and of themselves is a misattribution of blame.
This is a fair contrary point to raise. You can see its effect most clearly in the U.S. in the fear people have around health insurance, because it's so closely tied to their employer. (Which is also its own ball of problems, of course.)
We'd just be back to the wild west of employment law pre-1880s, except without even the meager fallback of employment contracts, everyone would be at the mercy of the owners.
a) continue working this horrible job and survive
b) quit working this horrible job and (lose healthcare/don't pay bill xyz/starve/insert outcome here)
My argument is that if survival isn't tied to gainful employment, the nature of work and the market will shift.
You might ask how that can be so - but one clear example, the market dictates these jobs do not provide benefits, that is their competitive advantage even. So how can a different company competitively provide non abusive practices?
I don't chase my pay. It takes me seconds to request my pay once a week.
I don't fight with difficult, unreasonable clients trying to screw me over. I let Textbroker handle them.
I have tried to promote their model as a good model. I have tried to suggest people should create businesses like it for other types of work.
So far, it seems like no one is listening to me.
If our government provided healthcare, eduction, a real pension program, non-terrible unemployment programs, etc. (as it works in most other developed countries) it would not matter if you are a gig worker or full-time employee. There would be no way to exploit you and gain a competitive advantage by hiring you as a contract worker. Companies and workers would be free to arrange employment simply around money and time. Benefits would not matter, and thus, the employment market would become more efficient.
The fact that US companies are wholly responsible for the quality of life of their employees is totally hilarious in a modern world where you don't work for the same company for your entire career. You can go from a 1st-world standard of living to a 3rd-world one simply by changing employers in the US. It's absurd.
The issue with most of these things is that governments, especially the US government, are generally worse at providing things than competitive businesses. For people who actually have health insurance, outcomes in the US system are better than in most other countries, the US higher education system is generally considered one of the best in the world, etc.
The key is not to nationalize services, it's to provide a baseline of support. Pay everyone a UBI. Then if you need healthcare, you have money, go buy healthcare. If you want to go to school, go to school. You don't actually need the government to operate the school, and you especially don't need it telling people what to spend the money on. (See also student loans and home loan interest subsidies and the effect on education and housing costs.)
Money doesn't have inherent exchange value per se. It's primary value is in reducing friction in trade. Injecting more money into a system without tying it to injecting more goods and services into the system is a known means to fuel inflation.
> Injecting more money into a system without tying it to injecting more goods and services into the system is a known means to fuel inflation.
Right now people are paying for things on credit. If you give them the money instead of requiring them to borrow it, the only difference is that they don't have to pay interest.
But it could cause inflation in specific assets if the stuff the net recipients buy is different than the stuff the net payers would have bought -- which would be amazing. We're currently having a huge problem with central banks not being able to hit their inflation targets even at historically low interest rates. If we had something that could bring inflation up to traditional levels it would be a boon, since it would allow nominal wages to rise which is badly needed since everyone is currently saddled with unprecedented levels of mortgage, student loan and credit card debt and anything that could devalue the debt would be a major benefit.
You are probably talking about the government borrowing it instead of individuals. This tends to not end well.
The money has to come from somewhere. If it isn't tied to creating new goods and services, then either you are basically printing more or taxing someone for it. Wealth transfer schemes are inevitably unpopular and tend to not work well. Schemes to "soak the rich" tend to get push back from the rich, who generally are in a better than average position to resist being victimized by the system.
Transfer payments are used as an economic stabilizer along with taxation. They also pool risk. You'll need to back up your assertion since most economists see some benefit to transfer payments, and most developed economies use them.
It tends to end with inflation eroding the debt. Which is exactly what we want in this case, ideally over time rather than all at once, but still.
> The money has to come from somewhere.
Why can't it come from nowhere? That's where the debt it's replacing came from. Banks don't actually have the money they loan you. They're only required to keep a small fraction of it in reserve. The rest of the money is created from nothing.
We're fundamentally in a position that we have to print a lot of money and cause a nontrivial amount of inflation because we already did that throughout the housing crisis and the response to it, allowing the prices of housing, education, healthcare and stocks to enter serious bubble territory. As a result of that either the nominal prices of those things have to come down or nominal wages and the nominal prices of everything else have to go up to reach parity with them.
But lowering the nominal prices of those things can't save the people who already paid for them on credit and now hold significant debt as a result, which is nearly everybody. Moreover, reducing nominal major asset prices tends to cause much more economic damage than raising the nominal prices of some other assets, because it causes people to default on underwater mortgages, hoard cash rather than investing it because the currency then appreciates in value, etc.
So inflation is good right now and printing the money would be a completely reasonable thing to do in the short term.
What happens after that is you pay for it from taxes, the same as the subsidy for [more specific program] would otherwise. But that should be a lot easier afterwards because real wages (and therefore real tax revenues) should be significantly higher than they currently are relative to the cost of necessities like housing, education and healthcare. In other words, the real amount of UBI you would need would decline with the real cost of those necessities.
> Wealth transfer schemes are inevitably unpopular and tend to not work well.
Then why do we keep passing/expanding rather than repealing various redistributive welfare and assistance programs?
My favorite scheme, f.ex, would rely entirely on a geoistic LVT-style dividend. The idea there is basically to capture externalities as rent, so no debt, taxes or money printing involved.
Such dismissiveness is unwarranted. There's a lot of intriguing research on the topic that indicates that it may be a cost-effective replacement for the byzantine social support systems of modern governments, with benefits for both recipients and taxpayers. It only seems like a broken model if you /start/ with an overly simplistic model of the current situation, e.g one that ignores both the existence and desirability of social support systems.
Unfortunately much of the research is frustratingly incomplete. Search e.g. for information on Mincome.
It also seems like a reasonable transition mechanism, from the market economies that have brought us increasing productivity, to a hoped-for post-scarcity future.
It’s just simply better than any of the other solutions man has dreamed up so far, that’s all.
It definitely is. As in "I'm not going to pay for bombing other countries, thanks."
Interestingly, your example undermines your case, because the US system is also less cost efficient than systems that are more market-oriented than it is.
The US healthcare system is uniquely problematic. It's not a markets vs. socialism problem, it's a unique damage that arises from trying to do things at such a scale.
Everywhere else in the world it's things the size of individual US states doing healthcare regulation, e.g. a median US state like Oregon has a GDP larger than Portugal or Greece. In the US it happens at the level of the entire union, which screws things up something terrible because it's well past the point that economies of scale give diminishing returns but it grows the public and private bureaucracies so large that they have their own inertia and gravity.
If the only thing the US did was repeal all federal healthcare laws and hand the whole thing over to the individual states, it would probably cut costs significantly. And then California could have single payer and New Jersey could require employer-provided coverage and Wyoming could let the market handle it entirely and probably all of them would do better than the feds are currently doing.
I don't like free healthcare because it often time can't even cover the minimum of what people need.
Many people who knew better went to Private Doctors even when we had free healthcare because they don't trust free healthcare and attitude of those healthcare provider. You end up wasting a lot of time in such system.
On paper maybe. As a person who lived in Russia and lives in Germany I disagree completely. How do you measure efficiency? Healthcare workers are blatantly underpaid in many european countries, waiting queues are getting longer, and the next potential chancellor is literally suggesting conscription as a solution for medical personal shortages.
Best is a balanced system with a mixture of private and public with public providing most of the infrastructure.
US life expectancy is lower than most northern European countries (plus Canada) or Northern Asian countries and costs are higher.
That said some EU countries like Switzerland have mostly private systems.
The only downside of government healthcare is generally taxes are added to unhealthy foods, tobacco and booze.
This is so true. If traditional jobs (not gig economy jobs) were better, no one would ever accept a gig economy job. Traditional full-time jobs are required to give healthcare and other expensive benefits (that governments everywhere else provide), so those businesses have cut down on the number of full-time jobs.
The real comparison here is between big companies who refuse to offer full-time jobs and instead rely on limiting hours to keep most of their jobs as part-time. People who accept gig economy jobs do so because they can work more hours per week (not artificially held under 39 hours so their company can avoid paying benefits). Generally people are rational actors when it comes to accepting the best employment opportunity, so if we see lots of people accepting gig-economy jobs it means that their other alternatives are worse. That's not a defense of gig-economy jobs but instead points out that this is a problem for all workers and suggests moving to a system that the rest of the world uses to solve the same problem.
That's because it's no really a solution. If everybody is made into an "entrepreneur" or "freelancer" or "consultant", then those gigs get just as shitty as employee, but without the extra protections.
If it was a proper free market then there would be lots of services like Uber that drivers could select from.
I still think that decentralized public platforms are the way to break the technopoly market strangleholds.
I'm not a free-market fanatic. I'm just someone trying to survive under circumstances where the world makes that unnecessarily difficult.
Gig work has been an effective antidote to otherwise impossible problems.
I wish I had a better life. I don't. Your attitude and assumptions are part of the problem for people like me.
The economy you are championing is one that primarily works for cis het white males. Women, people of color and other minorities were typically marginalized.
You clearly seem to disagree but you haven't explained why not having rights has been an antidote to deep-seated social issues. I see no causation.
If not for that your situation would be much better. The United States is singularly bad at protecting basic rights for people who are less than lucky in life, the gig economy makes this worse, not better because it now seems like there is a solution: let those at the bottom of the societal ladder fight over scraps in a race to the bottom.
Of course from your position scraps are better than nothing but there are much better options available too. But they all start with a society where 'winner takes all' is not the default.
Unfortunately the export of the gig economy to parts of the world where the social safety net is working just fine has the effect of slowly eroding that safety net because there is less of a perceived need for one.
No, that is not the only reason I am in this position by any stretch of the imagination whatsoever.
It's not true. I've basically been a military dependent my entire life. I've always had free or nearly free medical care. It's part of why I'm alive at all.
There are a lot of other issues with his assertions that I wouldn't know where to begin to address and trying to address them at all looks to me like social suicide for various reasons.
So thank you for the sincere and respectful inquiry, but it isn't likely to go anywhere good to try to answer it in earnest in a substantial manner.
I've lived on the US/Canadian border for 7 years and know the United States quite well, probably I have more friends there than I do here in Europe.
As for your life, you've spent years on HN educating everybody here on it in minute detail so if you want to make the case that I don't know anything about it then I suggest you read back your own comments and associated blog posts. I know more about your life than I know about my sister's.
> He assumes I have huge medical bills because I'm American.
My comment had nothing to do with your medical bills or lack thereof, and - given your comments to date - I would rather assume that they are low.
So to me it looks like the assumptions are all on your end.
On another note it is rather rude to answer to a comment thread and then to berate an earnest reply in this way.
I just didn't want to be silenced on the topic because it happened to be you saying it. I honestly didn't expect you to reply to me at all.
That said, I really wish you'd keep out of these kinds of spats, and/or have the wisdom to know what might trigger or exacerbate them. I could see this one coming a mile away the moment I saw 'jacquesm' replying to 'doreenmichele'. Even if she 'started it'.
And that said, my apologies for inserting myself in this conversation :). I wish you both the best, hope you can find common ground, and enjoy your contributions here a ton!
If they offer their app in jurisdiction A - they are operating under the laws of jurisdiction A, end of story.
I remain hopeful we can fix this.
Funny thing is that US has minimum wage and til recently had mandatory union participation. Sweden has neither. Yet, Sweden has a much better working conditions and more free market.
It's quite funny to observe US people got used to crony capitalism blaming free market for bad working conditions.
Labourism is doing better under free market, you just can't into labourism, that's the problem. When Britain abolished mercantilism in favor of more laizes-faire policies in mid 19th century, the labourism flourished, and the working conditions (which were nearly stagnant in the previous 50 years) improved dramatically.
Regardless the regulations you would impose you wouldn't have good working conditions until you achieve basic consciousness. Labourism is not about regulations, it's about consciousness.
Otherwise there would be a few in power dictating to the many, and it doesn't matter if these in power would sit in the governments or in corporations.
More generally, regulation is needed that removes all financial incentives to prefer gig workers and contractors over full time employees. This would be good for both gig workers (better benefits), and full time workers (less wage pressure from competition from workers with unsustainable compensation).
It comes down to stricter rules around employment. Gig-Employers are risking to get sued by there defacto employees and them being granted employment status, which then makes them entitled to receive minimum wage, healthcare, pension payments etc. even in hindsight.
So a "gig" has to be exactly that, it cannot be an actual job.
In a marketplace system, these people aren't employees; they're owners of their own business.
TaskRabbit and similar.
A marketplace making a requirement that contractors on their platform must respond to messages within N hours doesn't inherently make the contractors into employees. "We don't list people unless they meet these requirements" serves as a major selling point. "We list anyone who shows up" makes for a noisy, lower-value marketplace.
An economy is an inanimate object; it can't #{active_verb} something. This may sound nitpicky, but: language carries meaning; language influences perception; and, in this case, language ascribes blame.
Insofar as Ameirica is concerned, the contractors working for gig apps, like Uber or Postmates, have chosen not to exercise their rights to worker protections. Even as contractors, giggers have a legal right to unionize, collectively bargain, and form a cartel to demand better compensation. These people have chosen not to.
That's not to say organizing is "easy" -- especially when you're living paycheck-to-paycheck -- it's not. But, to the degree that contractors are upset enough to act, organizing is feasible and achievable.[1] Self-organization is the free-market solution to a person feeling exploited or trampled upon by his boss. No government intervention is required.
Given that the right to exercise collective bargaining is a choice, and afaik the majority of giggers do not collectively bargain, the rational conclusion is that these gig contractors aren't upset enough about the terms of their gig to take action.
[1] https://drivers-united.org/
Fine: the gig business model is undermining.
It's sad to see this sort of propaganda on HN.
Gig workers choose to take up a gig job in alternative to starvation, in most cases. There are big socioeconomic problems undermining the misguided notion that it might be a rational choice, in the overwhelming majority of cases.
This is why the State, in a modern society, is supposed to step in and forbid employers from taking advantage of workers.
These are lessons that were first learnt in the XIX and early XX century.
Would like to see a source on the claim that Uber drivers' only alternative is starvation. Uber has been founded in 2009, I am old enough not to remember mass starvation anywhere in the US before that. I am also vaguely aware of something called welfare state in the US that collects massive taxes exactly to prevent people from starvation (among other things), and I don't remember - before 2009 - any claims that this system has failed so much that people are suffering starvation in the US on the massive scale, or were until Uber came along to rescue us.
Moreover, to work for Uber, you must have a car (and a driver's license). Not just any junker clunker car barely moving around - a relatively nice car that a passenger would be fine with sitting it. Usually people literally starving do not have those, I think. In most cases.
My personal experience with Uber drivers (and other gig workers, like TaskRabbit or Fiverr) also does not match the description that they were starving before they had this job. Of course, this is only a personal anecdote, so I would very much like to see your source to that claim. Though I suspect you do not have one.
While it's not literal death from starvation, it's as close as you'll get in a country with agriculture subsidised in the way that it is.
That's not to say it's as melodramatic a situation as maybe the word 'starvation' presents itself, but do not delude yourself; people really are actually poor in real life. It happens. A lot.
> people really are actually poor in real life. It happens. A lot.
Who you are arguing with? I never claimed there are no poor people in real life. What I said that Uber drivers aren't doing it because their alternative is starving. Most people who are really poor do not participate in the gig economy at all.
Gig workers, at least in the UK, are overwhelmingly from minority and disadvantaged backgrounds; they don't do it out of choice, but because they have little or no alternative.
> to work for Uber, you must have a car
This is the same as for regular taxi work (there are various arrangements, but in most cases drivers end up paying for their vehicle one way or another). In fact, Uber lowered requirements since you don't need a specific type of cars (like UK cabs) or paint jobs/registrations (in most countries). And that's why it got popular: it lowered standards even further, in a sector already predominantly staffed by the worse-off.
> My personal experience with Uber drivers [...] also does not match the description
Of course; they want your five stars, they'll all try to look and sound happy and successful - not unlike many entrepreneurs.
If they have no alternative, that means removing these jobs would leave them with literally no income at all. How can anyone think it's a good thing?
> This is the same as for regular taxi work
No, it's not, at least not in the US where taxi medallion (completely government-imposed cost) could cost over a million before Uber, and even now can cost hundreds of thousands. Uber medallion costs $0 - they give you the windshield decal for free, as I heard.
> In fact, Uber lowered requirements since you don't need a specific type of cars (like UK cabs) or paint jobs/registrations (in most countries)
And that's bad because it allows those with no other alternatives to earn income access these jobs without impossibly high upfront investment, which also allows to better serve customers, which is obviously bad because.... ? I can't finish this phrase.
> Of course; they want your five stars, they'll all try to look and sound happy and successful
And that's bad because... ? Anyway, you can't be starving and dirt-poor and "look" an owner of an upscale Mercedes - you'd need the Mercedes at least. You can't just "look" like having one - you have to actually get one.
I would say "an evil" rather than "a hustle." Paying a few programmers six figures to write an app that commands lots of other people to work for less than minimum wage as "independent contractors" is evil. Calling it "sharing" or "tech" doesn't make it smell more sweet. Labor laws may not be perfect, but they have been built from centuries of experience, and sometimes blood[1,2]. It's a shame to see them being successfully ignored by a handful of morally bankrupt programmers.
[1] https://en.wikipedia.org/wiki/Triangle_Shirtwaist_Factory_fi...
[2] https://en.wikipedia.org/wiki/Ludlow_massacre
The gig economy casts light on the fact that America fundamentally fails to take care of its citizens in this important metric. Gig work would be less problematic in the US if we didn't expect employers to provide healthcare.
My life works at all when it shouldn't because of gig work. There are myriad issues making my life challenging, from serious health issues to sexism and classism. I get aggravated when I see people who are part of the problem in that regard vilifying the gig work that has allowed me to survive, problem solve, get back into housing etc.
Certainly, there are abuses. We should strive to make gig work a more positive thing generally.
But we should also strive to not throw the baby out with the bathwater.
https://www.youtube.com/watch?v=IyrhoHtSkzg
The obvious conclusion that people seem to be making in that the second class of jobs is evil and must be destroyed, and only the first class of jobs - clearly leaving a huge unsatisfied need from both producers and consumers of the service - should be allowed to exist.
https://www.ianwelsh.net/the-market-fairy-will-not-solve-the...?
> Here is the thing about Uber and Lyft (and much of the “sharing economy”).
> They don’t pay the cost of their capital.
> The wages they pay to their drivers are less than the depreciation of the cars and the expense of keeping the drivers fed, housed, and healthy. They pay less than minimum wage in most markets, and, in most markets, that is not enough to pay the costs of a car plus a human.
> These business models are ways of draining capital from the economy and putting them into the hands of a few investors and executives. They prey on desperate people who need money now, even if the money is insufficient to pay their total costs. Drivers are draining their own reserves to get cash now, but, hey, they gotta eat and pay the bills.