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When Old-Economy Jobs Become New-Economy Gigs

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I love the sharing economy because it’s efficient. Got some spare time? Become a TaskRabbit! Spare space? AirBNB it! A car and nowhere to go? Drive for Uber or Lyft! The taxi industry is a regulatory-capture nightmare. Disrupt ’em ’til they’re dead? Don’t mind if you do!

…And yet our 21st-century sharing-economy dream is beginning to look worryingly like a 19th-century robber-baron nightmare. When sharing-economy gigs supplement your income from your job, that’s great, everybody wins. But when sharing-economy gigs are your job? That’s different.

As the New York Times puts it, sharing-economy workers:

are less microentrepreneurs than microearners. They often work seven-day weeks, trying to assemble a living wage from a series of one-off gigs […] With piecemeal gigs easier to obtain than long-term employment, a new class of laborer, dependent on precarious work and wages, is emerging.

Re-emerging is probably a better word. In the early 20th century, the labor movement won workers eight-hour days, weekends, paid time off, etc. Before then, most labored like serfs, working long hours all week with no job security, no benefits, no vacations, no real prospect of advancement…

…in other words, exactly what you get today when you work at sharing-economy gigs, rather than at, you know, a job.

Not that technology is necessarily making those easier either. Another recent NYT piece reports on scheduling algorithms, which, in the language of Silicon Valley, are ‘redefining workforce optimization through big data.’ But on the ground, this:

pits sophisticated workplace technology against some fundamental requirements of parenting, with particularly harsh consequences for poor single mothers […] Flexibility — an alluring word for white-collar workers — can have a darker meaning for many low-income workers as a euphemism for unstable hours or paychecks

Don’t get me wrong. I’m an engineer. I love efficiency and optimization. But it’s hard to simultaneously optimize for both profits and people. Let’s not lose sight of the fact that algorithms which boost the former often tend to be pretty hard on the latter.

Similarly, I’m a big fan and frequent user of Uber, TaskRabbit, and Instacart. I think it’s great that people can supplement their income that way. But at the same time, as I’ve put it before: “sharing economy” is mostly spin. It mostly consists of people who have excess disposable income hiring those who do not. It’s hard to shake the feeling that, as in the 19th century, the world of work is dividing ever further between haves and have-nots–sharing-economy customers, and sharing-economy providers.

For haves like us, everything is awesome. And if things are rough for the have-nots, hey, that’s not technology’s fault, right? That’s a simple side effect of supply and demand, combined with, you know, healthy competition.

True, Uber and Lyft are in land-grab mode right now, and drivers are reaping the benefits. But land grabs don’t last forever, and there’s a glut of labor out there. “In July, 9.7 million Americans were unemployed, and an additional 7.5 million were working part-time jobs because they could not find full-time work.” Once the land grabs are over, most gig workers will be trivially replaceable, or even entirely disposable–and will suffer the consequences.

As Danny Crichton points out, the sharing economy and its algorithms can, in principle, have real benefits for its providers, too:

workers have the ability to develop their own personalities and brands … startup labor marketplaces are including computational trust and reputation systems from the beginning, ensuring that employers and employees have an incentive to work together and share credit.

This isn’t an entirely unmixed blessing–I’ve seen TaskRabbits sacrifice income in favor of reputation, and I suspect many customers use that tradeoff as leverage to pay them less–but on the whole it’s a good thing. Unfortunately those benefits pale and wither before the inexorable law of supply and demand. If there are too many providers and not enough consumers, too many have-nots and not enough haves, then most people who work in the burgeoning sharing economy are screwed. No scheduling algorithm or reputation system will solve that problem.

So the real question remains: is technology destroying jobs faster than it’s creating them? Are we moving from a Mediocristan world, wherein most people contribute a little, to Extremistan, wherein an ever-diminishing minority uses the lever of ever-improving technology to move the world to their liking, while more and more are excluded from jobs and must fight and scrap to get by with endless dead-end, barely-livable gigs?

That is one of this decade’s most important questions, and if the answer is “yes,” then the sharing economy is no solution. It’s barely even a band-aid.


Image credit: Serfing the wave, Wikimedia