Skip to content

The Gig (Economy) Is Up

The Gig (Economy) Is Up

June 8, 2019 SVadmin Comments 0 Comment

The jobs problem today isn’t just stagnant wages. It’s also uncertain incomes.

by Robert Reich

Uber drivers are supporting families with children, yet 40% depend on Medicaid and another 18% on food stamps. (Photo: Spencer Platt/Getty Images)

Uber just filed its first quarterly report as a publicly traded company. Although it lost $1bn, investors may still do well because the losses appear to be declining.

Uber drivers, on the other hand, aren’t doing well. According to a recent study, about half of New York’s Uber drivers are supporting families with children, yet 40% depend on Medicaid and another 18% on food stamps.

It’s similar elsewhere in the new American economy. Last week, the New York Times reported that fewer than half of Google workers are full-time employees. Most are temps and contractors receiving a fraction of the wages and benefits of full-time Googlers, with no job security.

Across America, the fastest-growing category of new jobs is gig work—contract, part-time, temp, self-employed and freelance. And a growing number of people work for staffing firms that find them gig jobs.

The standard economic measures—unemployment and income—look better than Americans feel

Estimates vary but it’s safe to say almost a quarter of American workers are now gig workers. Which helps explain why the standard economic measures—unemployment and income—look better than Americans feel.

The jobs problem today isn’t just stagnant wages. It’s also uncertain incomes. A downturn in demand, change in consumer preferences, or a personal injury or sickness, can cause future paychecks to disappear. Yet nearly 80% of Americans live paycheck to paycheck.

According to polls, about a quarter of American workers worry they won’t be earning enough in the future. That’s up from 15% a decade ago. Such fears are fueling working-class grievances in America, and presumably elsewhere around world where steady jobs are vanishing.

Gig work is also erasing 85 years of hard-won labor protections.

At the rate gig work is growing, future generations won’t have a minimum wage, unemployment insurance, worker’s compensation for injuries, employer-provided social security, overtime, family and medical leave, disability insurance, or the right to form unions and collectively bargain.

Why is this happening? Because it’s so profitable for corporations to use gig workers instead of full-time employees.

Gig workers are about 30% cheaper because companies pay them only when they need them, and don’t have to spend on the above-mentioned labor protections.

Gig workers are about 30% cheaper because companies pay them only when they need them, and don’t have to spend on the above-mentioned labor protections.

Increasingly, businesses need only a small pool of “talent” anchored in the enterprise—innovators and strategists responsible for the firm’s competitive strength.

Other workers are becoming fungible, sought only for reliability and low cost. So, in effect, economic risks are shifting to them.

It’s a great deal for companies like Uber and Google. They set workers’ rates, terms, and working conditions, while at the same time treating them like arms-length contractors.

But for many workers it amounts to wage theft.

If America still had a Department of Labor, it would be setting national standards to stop this.

Yet Trump’s Anti-Labor Department is heading in opposite direction. It recently proposed a rule making it easier for big corporations to outsource work to temp and staffing firms, and escape liability if those contracting firms violate the law, such as not paying workers for jobs completed.

On the other hand, California is countering Trump on this, as on other issues.

Last Wednesday, the California assembly passed legislation codifying an important California supreme court decision: in order for companies to treat workers as independent contractors, the workers must be free from company control, doing work that’s not central to the company’s business, and have an independent business in that trade.

(The bill is not yet law. It still has to pass the California Senate and be signed by the governor. And businesses are seeking a long list of exemptions—including ride-share drivers and many of high-tech’s contract workers.)

For example, they need income insurance rather than unemployment insurance. One model: If someone’s monthly income dips below their average monthly income from all jobs over the preceding five years, they automatically receive half the difference for up to a year.

They’ll also need a guaranteed minimum basic income—a subsistence-level cushion against earnings downturns. And universal health insurance and more generous social security, to make up for the unpredictability of work.

All of this should be financed by higher corporate taxes, ideally in proportion to a corporation’s use of gig workers.

Gig work is making capitalism harsher. Unless government defines legitimate gig work more narrowly and provides stronger safety nets for gig workers, gig capitalism cannot endure.


This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.

Print Friendly, PDF & Email

Articles, Economics, Politics

Post navigation

PREVIOUS
Sanders Leads Top 2020 Contenders on Greenpeace Climate Scorecard While Biden Places Dead Last
NEXT
“When They See Us” Is Triggering. That’s Why You Should Watch It

Join Our Mailing List

Leave a Reply Cancel reply

Your email address will not be published.

DONATE TO THE FOOD BANK OF NEVADA COUNTY

(CLICK IMAGE)

DONATE TO NEVADA COUNTY RELIEF FUND (click image below)

Erika Lewis, Shaye Cohn, Craig Flory – Got A Mind To Ramble

Jack Kornfield: A Steady Heart in Time of Corona Virus (Part I)

Tara Brach: A Steady Heart in Time of Corona Virus (Part II)

Subscribe to Sierra Voices Journal

Recent Posts

  • We Need More in Congress Like Jamie Raskin
  • After the Desperate Ignorance of the Trump Years, Biden’s Words About Science Make Me Weep With Gratitude
  • Mask News We Can All Use
  • Chaos agent: Right-wing blames US Capitol riot on notorious instigator banished by Black Lives Matter
  • How to stop an Insurrection Caucus: These reforms could reduce GOP extremism and save our democracy

Recent Comments

  • (Posted by) Don Pelton on GOP Warns Dems About Court Packing (Cartoon)
  • Criminal Incompetence, Malignant Ignorance Will Lead to Hunger and Violence on A Nice Depression Now Benefits the GOP in 2022 and 2024
  • togel singapura hari ini on How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme — Again
  • Ao Corrente on How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme — Again
  • forex forum on How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme — Again

Archives

  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • November 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • July 2018
  • June 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • March 2017
  • February 2017
  • January 2017
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • December 2015
  • June 2015
  • May 2015
  • April 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • January 2014
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • September 2009
  • August 2009

Categories

  • Aging
  • Articles
  • Atlas Obscura
  • Authoritarianism
  • Black Lives
  • Black Lives Matter
  • Blog
  • Buddhism
  • Cartoon
  • Climate Change
  • Constitution
  • Corona Virus
  • Corruption
  • Depression
  • Disenfranchisement
  • Economics
  • Education
  • Election Fraud
  • Environment
  • Farming
  • Fascism
  • Fire!
  • Food Insecurity
  • Foreign Policy
  • Forest Management
  • Gender
  • Health Care
  • History
  • Humor
  • Hunger
  • Ignorance
  • Labor
  • Local
  • Masks
  • Medical Care
  • Men
  • Mental Health
  • Middle Class
  • Mining
  • MMT
  • Modern Monetary Theory
  • Music
  • Native Americans
  • Pandemic
  • Parenting
  • Poetry
  • Police
  • Politics
  • Press
  • Race
  • Reviews
  • Revolution
  • Right-wing terrorism
  • Russiagate
  • Science
  • Technology
  • Trump Virus
  • Tyranny
  • Uncategorized
  • Voting
  • War
  • War on Government
  • Water
  • Watersheds
  • Wildfires

Meta

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org
© 2021   All Rights Reserved.