Friday, April 8, 2016

Jobs and the Gig Economy – Or Do I Mean the Sharing Economy? – Part 1

A new phrase hit the news earlier this year – the “gig economy.”  Like many neologisms, it is sort of catchy, evoking entertainment bookings and, with it, something of freedom and maybe creativity.  It first registered with me with a March 27th Salon Steven Hill article, “Good riddance, gig economy,” which was followed by a Wall Street Journal one the next day, “The Entire Online Gig Economy Might Be Mostly Uber,” and a Fox Business effort only this past Wednesday, which took a surprising for-them liberal view, “The Gig Economy:  Boon for Companies, Bust for Workers.”  Although the Journal used it as early as February 18th, The New York Times must have missed the beginning of this expression, since they had a similar piece three days before Salon’s, “The Uber Model, It Turns Out, Doesn’t Translate.”     

Unfortunately, this phrase also has a shortcoming typical of those in the early stages – its definition is fuzzy.  All four of these articles seem to conflate what the idea of working gigs would seem to be – people offering their labor for one-off opportunities – with what is still called the sharing economy, or income openings through providing other tangible assets, such as cars, apartments, tools, and so on.  Although owners must contribute labor in the process of sharing their possessions, that is secondary, even for Uber unlicensed-cab drivers, as what customers are paying for is the resource being provided.  On the other hand, someone willing to be paid to pick up and deliver something may not need any resources beyond time and effort.  A second unclear area is the steadiness of the work with one employer (sorry, Uber management, that’s in effect what you are).  Many and maybe most people driving for that company work full-time, meaning they are available to pick up customers continuously or almost so for over 30 hours per week.  That is in effect the same as true cabdrivers waiting for pickups or radio calls, but not the same at all as people with TaskRabbit or Mechanical Turk choosing working opportunities one at a time. 

Accordingly, I propose to use both expressions in better defined ways.  Let “sharing economy” be the correct form when assets other than labor are not only involved but required, and “gig economy” for individual work assignments.  When neither is the case, if for example someone is employed by a company but is only intermittently able to work and make money, call them, as Hill in effect wrote, temporary help workers.  Given that we’re talking about different things here, what can we say about them?  

A fair amount has changed with the sharing economy since I first wrote about it over a year ago.  As I predicted, there has been a real backlash.  There have been protests and new laws in cities from New York to Jakarta, both from competitors and governments, against Uber, informal hotel-room provider Airbnb, and their competitors.   However, Uber, usable now in 400 cities, car service Lyft, and Airbnb have continued to grow elsewhere.

So does the Uber model translate to other ventures?  Strictly speaking, despite the Times article’s title, it does.  Companies delivering restaurant food or parking cars are not part of the Uber model – they are simple labor services.  That their customers usually order and pay online does not make them fundamentally distinct.  Airbnb, though experiencing expected problems with zoning and other community restrictions, is a success, and there is every reason for people to continue to be compensated for lending everything from sanders to canoes as well.

Business propositions, and jobs, in the gig economy have generally weaker prospects, especially at the full-time income level.  However, there are some real hopes, and niches, for these service propositions.  What they are, and what they mean for jobs in America, will be the subject of next week’s post.  

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