The public discourse about the “on-demand” economy gets a D+. Wherever I turn, whether it’s the Economist, New York Times, TechCrunch, Re/code, Forbes, Washington Post or Business Insider, journalists, politicians and tech influencers all too often flock around a frustrating mix of myths, memes and conflation.
OK, that’s a bold claim. So you be the judge. Here’s what I see as the five main meh memes around the on-demand economy, and my version of more complete truths.
Myth One: It’s The “On-Demand” Economy
That’s only half the story. “On-demand” is from the perspective of those who can get their driver, groceries and dog sitter with a few app taps. We should be talking at least as much about the “Do It When I Want” (DIWIW) economy.
You could get a taxi before Uber, and a hotel before Airbnb. The level of convenience is new, but “on-demand” is not. What is new is that services such as Uber, Lyft, Rover, Airbnb and Spare5 enable people to make money doing what they choose, when they choose. When they don’t want to work, they can turn off their app.
Pundits and serious economists alike have concluded that the workers in the DIWIW economy would rather have good, well-paying, regular jobs. This is true of some, but not of all.
The destination is better capitalism, not utopia.
What is nearly always left out of stories around the DIWIW economy is the fact that it opens new avenues of connection to people you otherwise wouldn’t have met, and provides value to everyday people looking to change their career, take a step back or just make some extra money.
Myth Two: Flexibility Versus Security
There are a lot of holes in the United States’ social safety net. This is a serious, pressing and intractable problem. But the DIWIW economy is not causing these holes.
The reality is that technology inevitably brings disruption, and improvements, to society. Luddites and lemmings freaked out about the introduction of mass-market automobiles, assembly lines and personal computers.
We are still reckoning with the recent reality that more than 160 million Americans now check their smartphones an average of 150 times a day, and spend more time in their apps (4.7 hours daily) than watching television.
Is this really a bad thing? It’s complex, net positive and overall a continuation of what Durkheim foresaw more than 100 years ago as increased specialization creates more cohesive, productive societies.
Rather than hold our breath for unions, 401ks and universal healthcare, we need more social entrepreneurs like those at Even. And yes, we need more research to inform public policy, investment in education and other programs to benefit citizens looking for a living wage.
In terms of the DIWIW economy, academics should look objectively at the entire population of participants. Who is substituting for a traditional job, supplementing their income, transitioning between life phases and/or experimenting — why, when and how? Academics are starting to dive into this area and uncover results that don’t fit the popular assumptions about “on-demand workers.”
Myth Three: Bad Actors (Amongst DIWIW Company Founders) Are The Norm
This messy progress is not an excuse for those of us working hard to innovate. Homejoy is the latest casualty in the v1 wave of DIWIW companies. “How do we support and do right by those people while remaining a two-way platform?,” CEO Adora Cheung lamented to Re/code recently.
Uber is an easy whipping post. Sure, its cavalier leaders could benefit from more tact. When you grow that quickly and get that many people involved, there will be problems.
All entrepreneurs struggle, and most “fail,” but by chasing facile targets, journalists risk missing the big picture. Airplane crashes are spectacular, but commercial airliners are still the safest form of travel.
Or, as a friend is fond of saying, the plural of anecdote is not data. We need more real analysis, like what Jonathan Hall and Alan Krueger of Princeton are publishing about the diversity of the new economy.
Those of us building DIWIW/on-demand businesses have a responsibility to respect our contributors (who supply value) and our paying customers (who demand that value). The marketplace will continue to weed out those who fail to do so.
Myth Four: We Will All Become Anonymous Autobots
That brings me to the fourth and most annoying meme. But I see where it comes from. Amazon’s Mechanical Turk is the poster child of sourcing from the “crowd.” Amazon treats its “workers” as providers of commoditized human labor as an API. It’s dystopia as a platform, and its contributors resent it even as they plug in.
Amazon’s welcome instructions tell people not to share any personal information while “performing HITs.” It’s hard not to conjure up the image of the Matrix’s robots plugging us all into a giant battery farm.
Software does not disable our cerebral cortex. In fact, quite the opposite.
What should be happening is valuing these individuals for the skills they contribute via the DIWIW economy. As you read reviews of Airbnb stays, you find that the host or hostess is as important as the accommodations. And who doesn’t have a story of a fascinating conversation with an Uber or Lyft driver?
Yes the DIWIW/on-demand economy is about getting things done — and its by-product is connections with real people you would likely have never met otherwise.
Myth Five: It’s Man Versus Machine, And We (The People) Will Inevitably Lose
In reality, it’s not human insights versus machine learning, free will versus Terminators. MIT Professor Erik Brynjolfsson nails it when he points out that one of the great challenges for innovators is to marry the best of minds and machines.
Other respected tech observers, including Farhad Manjoo, see machine learning advances as just a step away from automating all work. But software does not disable our cerebral cortex. In fact, quite the opposite. Thanks to innovative technologies and marketplaces, people are better able to contribute what they choose, more conveniently and efficiently.
The best of the DIWIW companies will reward people accordingly, and give us all a chance to establish reputations, improve ourselves and yes, earn money. It’s definitely not perfect, it’s hard to get there and the destination is better capitalism, not utopia.
Still, we have the opportunity to improve billions of peoples’ lives, and reinforce the very free will that empowers us to do it when we want (or not).
Yes, we are in the on-demand economy. But by focusing on half the story, we’re missing the big picture. We are also in the DIWIW economy, as people now contribute and leverage assets that used to lie fallow — when they want. That’s net good, sometimes bad and often complex.
Making the best of this transformation requires liberating ourselves from backward-looking paradigms. The U.S. has one of the most dynamic labor markets in the world. Will that be the case when millennials come of age?