Gig Economy Promoters Drinking Their Own Kool-Aid

Los Angeles     There has been a lot of talk in recent years about the explosion of the so-called “gig” economy and whether its growth foretells the future of work for Americans.  Such a future would mean a series of part-time jobs, no clear employer or employment status, skimpy to non-existent benefits and a narrow path to sustainable work for millions.  Some think that the growth of such jobs would be plentiful enough to substitute for automation and deindustrialization.  Other have argued that a universal basic income needs to supplement the availability of such work in order to create sustainability.

No one ever really knows the future, but it’s always worth some amount of worry, especially when it comes to work.  When it comes to the gig economy though a recent report by Lawrence Mishel of the respected, DC-based Economic Policy Institute lays out a comprehensive case that those soothsayers arguing that the gig economy is the future are basically drinking their own Kool-Aid at least when it comes to its current impact on employment.

The EPI report looks most carefully at recent data on Uber drivers and their incomes.  The bottom line is that Mishel found that once all expenses, commissions, and benefit costs were factored in, an Uber driver was lucky to average $9.21 per hour.  When converting the number of part-time and some time almost 850,000 Uber drivers, Mishel was only able to convert about 90,000 into full-time equivalents.  Factoring in other studies that put the impact of Uber on total gig economy at about two-thirds, the role of gig work in overall US employment was a relatively miniscule 0.1%.  That’s not nothing, but it certainly doesn’t convincingly lay claim to portending the future of work past pure speculation.

Mishel brings his argument to a sharp point on the academic side, saying,

These findings—and the fact that many Uber and other workers who provide personal services via a digital platform do so on a part-time basis primarily as a way to earn supplementary income—argue for a change in perspective. There has been much hype around Uber and the gig economy. But in our assessment, in any conference on the future of work, Uber and the gig economy deserve at most a workshop, not a plenary.

If at best it’s only worth a workshop for economists, it’s hardly worth a full beer’s worth of discussion for labor organizers.

Informal, contingent, and temporary employment, no matter what they are called in the less than full-time service economy continues to give huge definition to global and domestic employment.  These are challenges worth the full-time struggle and effort.  Gig employers seeking special favors from legislators and money from investors to allow them free rein over workers have clear interests in promoting themselves as the future of work and everything else, but the rest of us need to brush off their special pleadings and keep our eyes on creating winning strategies for workers struggling now to build power in an array of real jobs in the current economy.


Job Training for Workers in the Gig Economy Era

New Orleans    An interesting question came from the audience after watching “The Organizer” in Santa Fe.  A gentleman asked what ACORN was doing and what was our thinking about job training programs these days.  I basically answered that federal monies were being cutback in job training, but for the most part there seemed to be a sense that job training programs were lost and ineffective, out of tune with both the modern economy and with the decreased mobility of workers in post-Great Recession period.  I threw something back that was glibber than well thought out bringing the question back to the problem of what exactly constitutes job training in the gig-economy and the coming age of mass scale automation.

The question clearly deserves a better answer than I offered, but it also got me thinking about exactly what kind of job training is appropriate in the second decade of the 21st century?  How does one train workers in the gig economy?  And, to what degree do many of these workers need job training at all, compared to support and assistance in running what amounts to a small business in self-employment?

One of the core characteristics of gig workers is the mobility and adaptability of their job skills and employment assets.  Whether they are employees of companies like Uber or independent contractors, under either definition at the heart of the business model for companies like Uber, AirBnb and so many other app-based employers are their hope and prayer that workers do not fully understand their self-interest and that they can pass off the normal costs of  business to the workers themselves.  There are no employment costs and workers are ill-trained to evaluate everything from house and car depreciation, insurance of all kinds including health, auto, home, and workman’s compensation, taxes and social security, and the list goes on.  It may not be a job training program in the way my questioner imagined, but to protect and advance gig economy workers, there should be government sponsored training programs that assist workers in how to navigate these shoals.

We all know men and women in these potentially exploitative situations.  The number of Uber and Lyft drivers who are barely making minimum wage for their hours worked is legion, and the number that realize that when they first enroll in the program is minuscule.  The number of short term rental people who are unprepared for making the decisions in handling city licensing and personal tax planning is also astronomical.

Perhaps if the government – and others – stepped up to this issue and offered the kind of financial education and support needed, these employers would have to get right with their workers, whatever they are called.  Perhaps if the government – and others – did that they should and also start to understand the long term social and individual impacts that will accrue for payment later, like social security and health care payments, they will step up to the task as well.

All of these questions need better answers.