The Bank of America has published an interesting report titled 'Has the gig economy peaked?'. It finds that the number of people with Bank of America bank accounts who are receiving 'gig-type income' (inflows from digital labour platforms) grew three-fold during the pandemic, but has fallen from 3.3% of American workers in March 2022 to 2.7% in February 2023. The report argues that a combination of lower demand for food delivery as the pandemic has eased and rising wages in other low-income sectors, especially retail and hospitality, are the push and pull factors which are moving workers away from the gig economy. Wages in retail and hospitality have been rising faster in the US than Europe, so the Bank of America data may not be fully reflected across the pond, but it's likely that many of the same trends are in play. What is more interesting to us is what this says about the long-term future of the gig economy. Digital labour platforms have been telling anyone who will listen that their model is the future of work, and indeed many critics of 'Uberisation' have assumed that what begins with ridehail and food delivery will surely spread to other parts of the economy. But is this assumption turning out to be wrong?In a paper published in November last year titled 'Why platform capitalism is not the future of work', Dario Azzellini, Ian Greer and Charles Umney argue that digital labour platforms have not met expectations, either "in terms of its size or indeed in terms of its business models or employment practices". Digital labour platforms are largely confined to sectors with low margins (at least in on-location platforms) and almost all of them have failed to turn a profit despite enormous venture capital investment. Moreover, the pay-per-task, algorithmically-managed gig work model has in many cases failed to deliver promised cost-savings, with some platforms returning back to traditional forms of per-hour work organisation instead. Workers who are gigified still tend to be restricted to the most marginalised, easily-exploitable sections of the workforce, especially undocumented migrants. "The key point is that in many of these sectors, in many local, national and online markets, the platform model exists only on the margins," the authors write.Some caveats are necessary at this point. There are important case studies of platformisation in a wide variety of sectors. Also, algorithmic management tools are pervasive in an increasingly diverse spread of jobs. Mechanisms of control which have been first road-tested at Uber can reach more traditional firms without those companies embracing all aspects of the gig model ('digital Taylorism' is one example). However, digital labour platforms as a distinct means of organising work on a 'piece rates' basis has not spread in ways that many thought likely, at least not so far. It's worth bearing in mind that it was not just new technologies that led to the emergence of the gig economy; economic conditions of low-interest rates and an excess of cheap money, as well as a labour market environment of a large pool of underemployed workers, were also essential ingredients for the rise of Uber and co. We are now in very different economic circumstances, and there are signs that in this new environment the gig economy may already be in retreat.This should be viewed in positive terms. Remember, it is the ideology of the platforms that they are an unstoppable force, that all workers will eventually be 'entrepreneurs' with 'flexibility' to work when and for who they want, and that opponents are dinosaurs stuck in the past. If the platformisation of work does indeed end up being a niche phenomenon, the argument that platforms should be given special lee-way - exempt from old-fashioned things like taxes and labour rights - because they represent 'the future' falls apart. Indeed, we should be actively seeking to knock-down artificial divisions between platform workers and other sections of the working class. In recent weeks GEP has sought to emphasise the risks of sub-contracting in the platform economy, a form of worker management which is also prevalent in sectors like construction. Grocery delivery couriers and 'pickers' are employed, but they remain precarious in a very similar way to workers in other low-waged sectors like supermarkets, retail and hospitality. The fact that data is involved shouldn't disguise the very old mechanisms of control which many platforms are using to reduce the cost of labour. If the gig economy is indeed in decline the Gig Economy Project will not shed a tear! Ben Wray, Gig Economy Project co-ordinator
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Gig Economy news round-up |
- DUTCH LABOUR INSPECTORATE FINDS WIDESPREAD ABUSES IN FOOD DELIVERY SECTOR: The Dutch Labour Inspectorate has found workers in the restaurant and grocery food delivery sectors are often too young, not paid enough and work under poor conditions. The large-scale investigation took place across 13 Dutch cities and relates to 350 couriers. In at least 20 cases, the delivery driver was under the age of 16, which is illegal in the Netherlands. 21 did not have work permits to work in the Netherlands, while some were paid in cash and/or not paid their full wages. The 'dark stores' in the Q-commerce sector were often dangerous for workers. Despite the widespread labour abuses, the report in 'NOS' only mentions actions taken against the workers in response to the findings, who were fined for "through a red light, not wearing a (correct) helmet and driving over the sidewalk". Read more here.
- CABIFY APPLICANT TOLD HIS WAGE WOULD BE JUST €4.21 PER HOUR: An applicant to be a driver for Spanish ridehail platform Cabify was told he will earn just €4.21 per hour if he gets the job, just over half of the legal hourly minimum wage in the country. In Spain, intermediary companies operate between the drivers and the platforms, with widespread reports of abuses of workers' rights at the intermediary firms. The applicant recorded an audio of him trying to obtain information from one sub-contractor about the driver position. He is told that there will be a four-month probation period and then he will be on a permanent contract. He will earn €1,113 a month, and will work 11 hours per day for six days per week. Read more here.
- WOLT MOVES INTO ICELANDIC MARKET: Finnish-founded food delivery platform Wolt has entered the Icelandic market for the first time. Wolt, which was taken over by US firm DoorDash at the end of 2021, now operates in 24 countries. Iceland is the first new market entry since the pandemic. “Iceland is an interesting and relevant market in our eyes,” Wolt’s manager of local operations, Elisabeth Stenersen, stated. Wolt has been in the spotlight in recent months due to a string of strikes by riders in at least seven European countries, in response to the introduction of a new 'dynamic pricing' payment system which riders say has reduced pay and increased opacity. Read more here.
- UBER ANNOUNCES "ACCOUNTS FOR TEENS": From Monday [22 May], Uber will for the firs time offer a ridehail service for teenagers aged 13 to 17 travelling on their own. Initially the service will be rolled out in 14 Canadian and US cities. It's not clear when or if it will be introduced to the European market. Uber CEO Dara Khosrowshahi said the service has "incredible security features integrated from the booking experience to the end of the trip," which includes route tracking, the ability to record audio and allows parents to contact the driver directly during the trip. Only drivers with the highest ratings and hundreds of trips under their belts will be allowed to pick up children, and drivers have the option to opt-out. Sergio Avedian, an Uber driver from the Rideshare Guy Youtube channel, described Uber's announcement as a "horrible idea", adding "what's the upside for drivers apart from added liability?" The company also announced that it will be establishing family profiles, where multiple Uber accounts can be linked together. Read more here.
- WORKER INFO EXCHANGE PROTEST AGAINST UK GOVT DATA BILL: Worker Info Exchange, a workers' data rights organisation, and the App Drivers and Couriers Union protested outside the UK Government's Business department on Thursday [18 May] to demand that the Data Protection and Digital Information Bill is dropped. WIX say that the Bill will undermine what few workers' data protections currently exist, making it easier for platforms to 'robo-fire' workers and to keep workers' personal data hidden from the workers. Protestors held placards reading 'kill the data bill', 'end algorithmic exploitation' and 'hands off my data'. The Bill, which was first introduced in March before being removed again, is due for its first reading on 18 July. The Government says the Bill will provide a “simple, clear and business-friendly framework that will not be difficult or costly to implement," but data rights campaigners fear that it will remove the need for transparency and accountability about how data held on citizens and workers is stored and used. There are also fears from some businesses that if the law is too divergent from the EU's GDPR, it will act as a block on frictionless data transfer between the UK and the EU. See more here.
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- The Cambridge Technology and New Media Research Cluster will host an online talk titled 'How to Do Things at Scale? (Re)Locating Platform Power in the Gig Economy' with platform work expert Dr Niels van Doorn, Associate Professor of New Media & Digital Culture at the University of Amsterdam, on Monday 22 May, 3-4pm. Click here for full details and to register.- A 'tech for good' festival, an alternative conference to London Tech Week, hosted by Outlandish and Space4 will take place in London on Friday 16 June. It will including sessions on 'def-EAT-ing the gig economy' and 'Platform capitalism? What about platform socialism?'. Click here for full details and to register.- The Platform Labor Project and the Global Digital Cultures Initiative are holding a hybrid international conference on 'Global Perspectives on platforms, labour and social re-production', at the University of Amsterdam, 27-28 June. Details here.
Know of upcoming events we should be highlighting? Let us know at GEP@BraveNewEurope.com.
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The Gig Economy Project is a media network for gig workers and we welcome contributions from workers, writers, academics, activists - anyone who wants to stand up for workers' rights in the gig economy.
If you would like to write for the site, discuss arranging an interview with GEP, or simply have information about developments in the gig economy in Europe you think we should be aware of, get in touch.
Contact project co-ordinator Ben Wray at GEP@BraveNewEurope.com or send a direct message to the Twitter: @project_gig.
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