The Uberization Of Work: Pros And Cons Of The Gig Economy by Forbes – Entrepreneurs

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Getting flexible, part-time work has never been easier, but for some the gig economy is an inescapable honey trap.

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As the gig economy has grown it has become an intrinsic part of our digital society. But its meteoric growth has not left much room for forethought about the impact it might have on society and employment, and there is still much debate around the benefits and risks of this way of working. Working more flexibly on a job-by-job basis is touted by some as the ultimate in employment, and provides a lot of freedom for those that desire it. However, part-time workers do not have the same benefits as full-time employees do, leaving them without the job security and peace of mind that nine-to-fivers enjoy. Furthermore, large companies are accused of profiting from worker instability.

I spoke with Steven Power, the Global President of Deputy, and Shawn Cadeau, the Chief Revenue Officer (CRO) of Jobber, about the ‘uberization’ of work, how the gig economy is affecting workers now, and their opinions on what needs to change for the future.

Pros: Easy, flexible, part-time gigs

“If you’re a kid going through college, if you’re retired or if you’re a single mum, you’ve never had it better,” says Steven Power, the Global President of Deputy and enthusiastic serial entrepreneur, “you can drive Uber, you can do TaskRabbit, you can work when and where you want—it’s a very flexible way of working.” Working on your own terms, with your own hours and earning your own wage has been a dream since the inception of the office and ‘office hours’ . Many people work exclusively in gig economy roles – working two or three jobs and still finding time to focus on their own pursuits. In fact, “the power is moving more towards the employee,” says Power, “SMEs [Small to Medium Enterprises] are finding it bloody hard to recruit waiters and waitresses, because nobody wants to do that anymore, they want to work Thursday night, they don’t want to work Fridays, and there is so much choice out there for workers now.”

Companies of all kinds are finding that when people can choose what they wish to do, can work  in a variety of small jobs and get paid similar wages as a full-time role with more comfortable hours, there is a lot more effort required to attract and retain employees: “unless you’re offering a better workplace experience they’re not going to come and work for you,” says Power. Improving the ‘soft’ benefits of a company, such as a modern office space, free food and drink and even free massages (offered at the WeWork space where Power was calling from) is one way to attract talent to your company. But consumer power has also increased with a higher emphasis on the values and business practices of a company. In the age of social media, companies can no longer hide their misdeeds from a potential employee or customer, and are expected to abide by the norms and values of society as a whole. “Public companies are saying we can’t destroy the environment because it’s not popular, we need to make sure our actions reflect our society,” says Power, “one thing I love about the uberization of work is that things are getting much more transparent, and companies either have to comply with public will, or cop the flack.”

This aspect of the gig economy is enabling smaller business to compete with the huge, often multi-national, competitors by making use of the same technology that helped these companies grow in the first place. “The ability to connect service providers with customers, automate scheduling and communication, optimize routing and integrate payment into a single platform now makes it easier than ever for SMEs to stay competitive,” says Shawn Cadeau, CRO of Jobber. The ability for a small business to hire temporary workers to fill demand, and make do with a skeleton staff when more employees are not needed is a massive benefit when competing against huge companies, but this system could have wider negative effects on employment and the economy overall.

Cons: No security, stability, or safety nets

Temporary, irregular work may be a boon for those looking for extra money on the side or with unpredictable schedules, but there is a huge middle class that relies heavily on gig work, cannot afford instability, and are not getting fairly paid for the amount of work they are doing. “On the one hand it’s the future of work, on the other it’s absolutely Darwinian survival of the fittest, I think both views are simultaneously real and relevant,” says Power. For the disenfranchised middle working “two or three jobs and changing one every six months” (what Power calls a “high viral coefficient”), gig work does not offer the job security needed for planning a proper life, and does not allow for a sense of pride or belonging that many full-time positions provide.

“Google now employs more contractors than full-time employees,” Power notes, “and this creates a second class of workers, sub-Googlers, that aren’t getting any benefits despite working for one of the most successful companies in the world.” Apart from undermining the stability of individual workers, the erosion of the middle working class for the benefit of corporate profits represents a “profound change” in our society, according to Power, “and we should ask ourselves at what cost this change in work is happening.” This situation is becoming all too common, as multi-national organizations that profit from the labor of gig economy contractors are operating in a legal and ethical grey area. For gig economy companies themselves, this grey area enables their continued existence and profitability.

In Uber’s IPO prospectus it outlines the risks of “compensating Drivers… with the application of hour and wage laws (including minimum wage, overtime, and meal and rest period requirements)” and states that any such “reclassification [of drivers as employees]… would have an adverse effect on our business and financial condition.” This makes it clear that, despite Uber’s rocky IPO, the company and all others like it will continue to profit off the substandard working conditions of their contractors, purely because they are not recognized as employees with applicable expenses. Cadeau states that this particular element of the gig economy has “shifted nearly all risk away from employers and onto contract workers,” leaving contractors that rely on getting work consistently with little in the way of bargaining power. External platforms and interim services like Jobber and Deputy (that match workers and companies, rather than ‘employing’ ranks of permanent contractors), Cadeau argues, promote “the true entrepreneurial spirit of the gig economy,” to go against the grain of large technology companies benefitting from on-demand sub-employees.

Good for workers, or good for business?

The gig economy is a frank warning for individuals and regulators alike about the intricacies of integrating technology with our society. Given the unbridled success of gig economy companies, it seems that a lot more oversight is needed to untangle this phenomenon before we stumble into a crisis of inadequate and volatile employment.

For those that love the gig economy, it is the best thing to happen since fair employment rights first came into effect—providing freedom to choose how they earn, when they work, and how much time they spend on their own interests. For those that rely on it, the need to constantly search for work with no guaranteed income and no legal framework from which to protest against unfair treatment, it is a nightmare.

Perhaps instead of replacing full-time employment with these fleeting roles, we should think about making full-time employment more flexible itself, allowing full employees the freedom to work when and where they like without the risk of going hungry or homeless. Gig economy work, whether you love it or loathe it, is here to stay – but maybe we need to curb its influence in the strained middle, change our idea of fixed employment to suit a digital age, and leave a smaller portion of the market to earn as much or as little as they wish.

July 8, 2019 at 06:11AM
https://www.forbes.com/sites/charlestowersclark/2019/07/08/the-uberization-of-work-pros-and-cons-of-the-gig-economy/
Forbes – Entrepreneurs
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