200k drivers. $25k for the kit (car, phone, misc). That's $5,000,000,000 of costs Uber & Lyft ducked.
What other employment requires you to front the boss $25k for the privilege of earning starvation wages?
For years, both Lyft and Uber have said that if they are forced to reclassify gig workers as employees that such a change would have an adverse effect on their profitability...
Sort of. Lots of Uber drivers already had a car, phone, and commute that they could make and extra $20 each day on if they drove an extra 15min out of their way. This isn’t too much but over a month would add up.
Of course now that COVID is a thing much of this has stopped.
Is that really a realistic driver scenario or was that the nice story told by Uber? From my (limited) experience with Uber drivers, none of them only "drove an extra 15min out of their way" on their normal commute, nothing even close to it. It was a job like any other for them.
I do believe it, it was really bad traffic that day too from Renton to the udistrict. Dudes wife was a pharmacist (trained at UW), we talked about some random biotech stuff so I’m 99% sure he wasn’t lying.
This is not that common but some people do. Now if it is a Prius with tinted windows on the other hand that’s someone doing it as a job.
For the first few weeks after high school, I delivered fast food--pizza and chicken mostly. This was probably ten years before the pizza outlets noticed that you could get a kid to use the family car to deliver pizza. I am very grateful that the thought hadn't occurred to them yet. I am also confident that if I had come home and told the folks that I found this summer job, I just need one of the cars, they would have said, Keep looking.
Uber/Lyft and the rest of the gig economy have helped to improve the 'liquidity' of jobs. This is generally a positive for society as it allows for more rapid wage price discovery.
Government policies have continually eroded this liquidity. For example a tax subsidy for employer-provided health insurance may sound like a benefit, but for many it raises the barrier to switching jobs. The new company may not offer the same insurance thereby not allowing you to keep your doctor. Companies know that these barriers exist and it allows them to underpay employees.
The other problem is by tying all of these benefits to gainful employment, we make losing a job an unrecoverable event for too many. Not only does someone now have the stress of finding a new job, but they also lose health insurance, disability, retirement benefits, etc. We should be adopting policies that make it easier for people to switch jobs, not harder.
Modern policymaking is about optics, and the simple fact is being employed looks better on paper for the people, so that's what politicians will push for. Doesn't matter that overall it's worse for everyone.
I think this is actually a step in the wrong direction that is likely to result in us going in the right direction faster. The core of the problem we have is that there are a bunch of new jobs known as "gig economy" jobs and they don't neatly fit into the traditional idea of a 9-5 job.
The result is that currently you basically fall either into "Yes 9-5 job, employee protections, healthcare, regulation etc" or "Not an employee, no protections, no unemployment insurance etc.". The thing is, when these jobs were considered like the latter case, they worked great for gig economy companies since it makes their workforce weak, and gives the companies as much leverage as they could possibly want and shifts liabilities off their balance sheets. The problem is that it's very difficult to get that regulatory scheme changed by workers, because that's not who has power in this system.
Now that workers are in the "employee" camp we've now got a bunch of highly motivated companies that are going to lobby for reform, and if we're careful to do it right, we could actually see the reforms that should have been made earlier anyway where there's no longer this massive chasm around the term "employee".
The reason that these kind of jobs exists in the first place is not some inherent sudden demand for them by modern society. It's because this form was required to create the plausible deniability that the drivers were not employees and thus much cheaper labour. This is the entire USP of the gig-economy, lower labour costs. Don't get fooled by a shiny app.
I deliver for Doordash and Grubhub. I don’t accept every offer that comes to me, I keep both apps open and I wait for an offer that I know I can profit from. If I were an employee, I’d likely be obligated to take every job offer and get my guaranteed minimum of say, $12 an hour. But as independent contractor, I can make $20 an hour. Isn’t the best, but I make more than McDonalds and I don’t want to chain myself down somewhere while I look for an actual internship/job in my field (halfway through a computer engineering degree). It gets me through college and I take more ownership in the job than if I was just some employee at chumbawumba cheap labor Corp. Only benefit I would wish for in my case is some sort of car insurance offer given a minimum delivery quota and discounted maintenance plan (oil changes, etc.) as it’s directly relevant to the type of work.
Government is expanding the scope of definitions used for regulation until everything fits. "Regulation creep risk" must be accounted for by investors and entrepreneurs seriously considering chasing their dreams.
Even if you are technically correct that your startup isn't within guidelines, you'll need hundreds of thousands (millions?) of dollars of budget to fight a neverending series of lawsuits.
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[ 3.1 ms ] story [ 16.4 ms ] thread200k drivers. $25k for the kit (car, phone, misc). That's $5,000,000,000 of costs Uber & Lyft ducked.
What other employment requires you to front the boss $25k for the privilege of earning starvation wages?
For years, both Lyft and Uber have said that if they are forced to reclassify gig workers as employees that such a change would have an adverse effect on their profitability...
No doubt.
Well, traditional taxi driver, for one.
Of course now that COVID is a thing much of this has stopped.
This is not that common but some people do. Now if it is a Prius with tinted windows on the other hand that’s someone doing it as a job.
Uber/Lyft and the rest of the gig economy have helped to improve the 'liquidity' of jobs. This is generally a positive for society as it allows for more rapid wage price discovery.
Government policies have continually eroded this liquidity. For example a tax subsidy for employer-provided health insurance may sound like a benefit, but for many it raises the barrier to switching jobs. The new company may not offer the same insurance thereby not allowing you to keep your doctor. Companies know that these barriers exist and it allows them to underpay employees.
The other problem is by tying all of these benefits to gainful employment, we make losing a job an unrecoverable event for too many. Not only does someone now have the stress of finding a new job, but they also lose health insurance, disability, retirement benefits, etc. We should be adopting policies that make it easier for people to switch jobs, not harder.
The result is that currently you basically fall either into "Yes 9-5 job, employee protections, healthcare, regulation etc" or "Not an employee, no protections, no unemployment insurance etc.". The thing is, when these jobs were considered like the latter case, they worked great for gig economy companies since it makes their workforce weak, and gives the companies as much leverage as they could possibly want and shifts liabilities off their balance sheets. The problem is that it's very difficult to get that regulatory scheme changed by workers, because that's not who has power in this system.
Now that workers are in the "employee" camp we've now got a bunch of highly motivated companies that are going to lobby for reform, and if we're careful to do it right, we could actually see the reforms that should have been made earlier anyway where there's no longer this massive chasm around the term "employee".
Even if you are technically correct that your startup isn't within guidelines, you'll need hundreds of thousands (millions?) of dollars of budget to fight a neverending series of lawsuits.
Transportation industry is but only one example.