The sharing economy has probably outgrown its utopian phase by now and we can actually start discussing some of the issues relating to it. If you are not clear on what is meant by the sharing economy and where it started then this Sharing Economy Wikipedia page is a good place to start.
Kevin Rose provided a useful insight into the sharing economy recently: The Sharing Economy Isn’t About Trust, It’s About Desperation. He notes that the emergence of the sharing economy relates to the ongoing weakness of the traditional economy.
Back in 2010 John Robb talked about cognitive slavery, or crowdslaving. He explored the idea that our cognitive surplus has been deployed to the benefit of companies like Facebook or Google for no recompense.
More recently Jarod Lanier has questioned the consumption of our unpaid labour by internet companies: Jaron Lanier on Internet and middle class: “We have screwed things up. A key link between Robb’s and Lanier’s work is the notion that our online labour could and should be recompensed by means of micropayments.
However, the idea that runs through both their thinking is that we have moved from a world of labour where workers collaborated in unions that worked to obtain fair pay and conditions to one where there is no form of protection for the gig workers. It is easy to forget all the good that labour unions have done for workers, as Smith noted in his 2018 piece, Unions Did Great Things for the Working Class:
“First, even back in the 1970s, some economists realized that unions do a lot more than just push up wages. In a 1979 paper entitled “The Two Faces of Unionism,” economists Richard Freeman and James Medoff argued that “by providing workers with a voice both at the workplace and in the political arena, unions can and do affect positively the functioning of the economic and social systems.” “
I suggest that we ought to view the emerging gig economy with suspicion. Certainly it offers its workers flexibility, but at what cost to workers and society?
The UN labour agency reported in late April 2020 that Nearly half of global workforce at risk as job losses increase due to COVID-19. Stating:
“The findings appear in the ILO Monitor third edition: COVID-19 and the world of work, released on Wednesday. Globally, there are some 3.3 billion workers. Two billion have jobs in the informal economy, representing the most vulnerable workers in the labour market.
The agency said 1.6 billion in the informal economy “have suffered massive damage to their capacity to earn a living” as a result of the economic meltdown created by the COVID-19 pandemic.”
Now with the massive job losses from the COVID19 pandemic, jobs are at risk and I believe that companies are going to respond to the pandemic in the following important ways:
- Companies will increase automation of jobs – this will be driven by AI, ML, bots and related technologies.
- More workers will be forced to seek work in the gig economy, and this will mean that workers will not have rights to things like paid sick leave and to a regular pay. Thus workers will find that they have entered, what we call in Higher Education, the precariat.
- Some companies will be winners from the pandemic – companies like Amazon, Ali Baba, and Microsoft will emerge stronger – and this will accelerate centralisation and reinforce global corporate power structures. This will cause a bifurcation of workers. With those at the winning companies from the global pandemic doing very well, and those who are forced into the gig economy living a precarious and pressured existence.
The emerging global precariat
Even the Harvard Business Review noted back in 2018 in a piece by Petriglieri , Ashford and Wrzesniewski, Thriving in the Gig Economy, that one of the key challenges to the gig economy is the emerging precariat:
However, the price of such freedom is a precariousness that seems not to subside over time. Even the most successful, well-established people we interviewed still worry about money and reputation and sometimes feel that their identity is at stake. You can’t keep calling yourself a consultant, for example, if clients stop asking for your services. A well-published writer told us, “You become your work. If you write a good book…it’s really great, and when you don’t achieve it, you have to accept…that failure might define who you are to yourself.” An artist agreed: “There’s no arriving. That’s a myth.”
For many workers in the Higher Education industry the precariat has been their lot for decades. Moving from one short term gig to the next, never able to save money or buy a house. Now many other people, even those who did the right thing and got an education and a middle class career, will find themselves working in the gig economy.
And, as more people have uncertain employment we may find ourselves facing consequences from the precarious nature of their lives. Back as early as 2016, Guy Standing noted that this can drive the growth of populism, Meet the precariat, the new global class fuelling the rise of populism, and this can be seen in the rise of populist leaders around the world.
This future is not locked in stone. There are different ways we can respond to the challenges of the global pandemic. Some countries have paid their unemployed workers during the lockdowns that have characterised the pandemic – perhaps a universal basic income is part of the solution? With folks starting to ask these kinds of questions – Could Covid-19 be the push that Europe needs for unconditional basic income? – it is possible to imagine that Covid19 can give us impetus to do things differently. This is certainly a possibility for Europe, Scandinavia, parts of Asia, Australia and New Zealand. But I do not expect to see this kind of thinking being possible to implement in the United States or United Kingdom, given their respective governments.
In any case. We have choices. Things do not have to remain the way they were, or go where they are headed. We can choose to reset things.
Of one thing I cam certain, Amara’s Law will hold true of Covid19:
“We tend to overestimate the effect of a
technology[pandemic] in the short run and underestimate the effect in the long run.”
Featured image by: Davide Alberani