serving workers gig economy

Serving Workers in the Gig Economy Emerging Resources for the On-Demand Workforce Nick Grossman and Elizabeth Woyke Serving Workers in the Gig Economy by Nick Grossman and Elizabeth Woyke Copyright © 2016 O’Reilly Media, Inc All rights reserved Printed in the United States of America Published by O’Reilly Media, Inc., 1005 Gravenstein Highway North, Sebastopol, CA 95472 O’Reilly books may be purchased for educational, business, or sales promotional use Online editions are also available for most titles (http://safaribooksonline.com) For more information, contact our corporate/institutional sales department: 800-998-9938 or corporate@oreilly.com Acquisitions Editor: Susan Conant Editor: Susan Conant Production Editor: Melanie Yarbrough Interior Designer: David Futato Cover Designer: Randy Comer Illustrator: Rebecca Demarest October 2015: First Edition Revision History for the First Edition 2015-10-21: First Release The O’Reilly logo is a registered trademark of O’Reilly Media, Inc Serving Workers in the Gig Economy, the cover image, and related trade dress are trademarks of O’Reilly Media, Inc While the publisher and the authors have used good faith efforts to ensure that the information and instructions contained in this work are accurate, the publisher and the authors disclaim all responsibility for errors or omissions, including without limitation responsibility for damages resulting from the use of or reliance on this work Use of the information and instructions contained in this work is at your own risk If any code samples or other technology this work contains or describes is subject to open source licenses or the intellectual property rights of others, it is your responsibility to ensure that your use thereof complies with such licenses and/or rights 978-1-491-94329-8 Chapter Serving Workers in the Gig Economy T L;DR: SUPPORT ING WORKERS IN T HE GIG ECONOM Y Macro forces are unbundling the benefits and protections that have traditionally come from full-time employment This is putting great strain on public policies aimed at protecting workers, in particular the notion of “worker classification” (employee vs contractor) as the primary determinant of responsibility for benefits and protections Meanwhile, new services are emerging to support workers in the gig economy, providing many of the benefits and protections previously attached to employment, but using a model that understands and fits with the shape of the gig economy Here, we explore the categories of services being developed and profile a sampling of companies building offerings in the space The Great Unbundling We are in the midst of a great social and economic shift Global, mobile connectivity and ubiquitous data are steadily restructuring not only our interpersonal relationships, but our economic and industrial systems This great reshaping has often been referred to as unbundling—the breaking up of previously understood packages of goods and services into their component parts, eventually to be rebundled in new ways We are familiar with the unbundling of the media and publishing industries—from triple-play cable packages to Internet + Netflix + Amazon + AppleTV; from compact discs to MP3 downloads, to streaming services; from print newspapers and books to blogs and eBooks—and the same is steadily happening to every other economic and industrial sector It’s even happening in highly regulated sectors such as transportation (ride-sharing), housing (home sharing), finance (peer-to-peer lending, crowdfunding, Bitcoin), and health (telemedicine, personal sensors, home diagnostics), where the regulations that shaped these sectors in the 20th century are coming under intense pressure to adapt This great unbundling means that products and services are often much more accessible, in much smaller pieces, and from a greater number of providers What is true from the consumer’s perspective is also true from the worker’s perspective: work is now more accessible than ever, but it’s coming in a different form Rather than a single job from a single employer, we now have access to many jobs from many sources, in many shapes and sizes As this happens, the very notion of a “job” is being unbundled into its component parts The Unbundling of the Job So, what’s in a job, exactly? What are its component parts? How are they coming unbundled? Author Nick Grossman’s colleague from Union Square Ventures, Albert Wenger, describes it as such: “Do people need jobs or can we deliver what jobs provide some other way and in a potentially unbundled fashion? The “jobs of a job” include income, structure, social connections, meaning, and at least in the US, access to healthcare.” In other words, the things we’ve come to think of as the components of a “job” aren’t inherently bound together And indeed, the unbundling of the job means that each of these components, and more, are becoming available from new places, and are able to be bound together in new ways Later in the report, we’ll look in detail at the following components of the work bundle: Job Discovery and Scheduling How one finds work and manages his/her time Finance and Administration Managing money and admin tasks such as paying taxes Benefits and Insurance From healthcare, to worker’s comp, to retirement Identity and Reputation Both are critical to succeeding in the gig economy Community and Organizing Modern versions of the water cooler and union hall Education and Training Skills development, just as with work, comes from many sources Facilities and Equipment Rethinking what it means to be “in the office” Much attention has been paid to the first component, which is essentially income Independent from the other previously bundled components of “a job,” it’s easier than ever to find sources of income online A major force here is the “platformization” of work, meaning the emergence of web and mobile job marketplaces and work platforms such as Amazon’s Mechanical Turk, the freelancer marketplace Upwork, and on-demand service platforms such as Uber, Handy, and Doctor on Demand Online work platforms build on top of these fundamental trends and provide two primary services: first, making markets, cultivating and sustaining both supply and demand; and second, establishing “trust and safety” systems (such as escrow, reputation, insurance, and acceptable use policies) that ensure the smooth operation of the marketplace Such platforms are not the underlying cause of the shift, but are rather an accelerant There are more fundamental drivers of this shift: The web and mobile connectivity that enables more direct, person-to-person transactions of all types The age-old push of corporations to lessen their reliance on full-time workers, and increase the utilization of part-time and contract workers, for cost-saving reasons All told, these forces are drawing more and more people into the part-time labor force, aka the “gig economy.” According to a recent study by Freelancers Union and Upwork, in 2015, nearly 54 million Americans—roughly 34% of the US population—participated in some form of freelance work, and the trend is accelerating year over year Aside from the income component of the job bundle, which has seen enormous experimentation and growth in the past decade, we are now beginning to see the emergence of the other parts of the bundle That’s what this report will focus on—the tools and services that gig workers might begin to rely on to fulfill the set of needs that was previously fulfilled by a full-time job We should note that the “gig economy” is not monolithic It includes work that is both low wage/commodity (such as driving and traditional hourly shift work), as well as high-end and specialized (such as graphic design and medical services) It includes work that looks more like “a job” (such as delivering food) and work that looks more like a “micro-business” (such as producing and selling craft goods) “The things that stress out Gig Economy individuals are largely the same stresses suffered by someone who works at Target or in a pretty traditional service employment capacity.” Quinten Farmer, Even At the same time, many of the same considerations apply throughout the “gig economy,” the most fundamental being a less stable source of reliable income, and less access to traditional benefits and protections The Gig Worker’s Dilemma “As an independent worker, all this infrastructure and stuff used to be taken care of by a company and now you have to figure it out on your own And it can be impossible to solve.” Shelby Clark, Peers The heart of the challenge of being a gig worker is that you’re on your own No single employer is responsible for you or to you You’re no one’s responsibility, except your own This means that it’s up to you not only to find work and stay busy, but also to manage all of the overhead that comes with being a worker, “business owner,” and taxpayer If we imagine all of the support services that were previously bundled with full-time employment—from steady employment and income, to navigating the federal and state bureaucracies, to providing benefits and insurance—all of that now falls on the worker directly Looking at the job bundle outlined above, the job-related components of the social safety net are of critical importance Traditionally, much of that safety net—in particular, benefits such as unemployment, disability, retirement, and worker’s comp—have come from employers, based on the assumption that people will have a single employer with whom they have a long-term, monogamous relationship But as work becomes unbundled, the underlying assumption that the social safety net can stay bundled to the job is being challenged For reference, below is a brief review of the primary benefits and protections that have traditionally been bundled with employment: Steady income The foundational need to have steady, reliable income, to support basic needs Traditionally, firms have shouldered this risk and hired accordingly Minimum wage Price floor for wage labor, intended to ensure a minimum standard of living Overtime pay Employees are typically entitled to 1.5 times pay for work exceeding 40 hours per week.a Antidiscrimination The Civil Rights Act and the Americans with Disabilities Act prohibit hiring discrimination on the basis of race, color, sex, ethnic origin, and disability, respectively.b Workplace health and safety The Occupational Health and Safety Administration (OSHA), a part of the US Department of Labor, Healthcare Medical, vision, dental Employers are required to offer affordable (