Advanced Markets for Irregular Employment

What’s their problem?

“Connective tissue” between irregular work-seekers and hirers is inadequate. But there is nothing like the public infrastructure on offer to job-hunters.

180207 angry

 

One-sided relationships

offline2The rise of irregular work has shifted power to employers:

  • Most odd-hours of work are still found by word-of-mouth; going from café to bar to store to homeowner asking for ad hoc employment, probably for cash-in-hand. Recurring abuses include; wage theft, lack of insurance and high rate of workplace accidents.

 

  • Working for a primary employer who calls you in only as-required also has obvious downsides. How do you; Plan childcare? Put food on the table regularly? Find odd periods of work when not called in, while remaining available in case needed tomorrow?

 

It’s hard to see what’s going on in these huge areas of uncertain employment. Illegal, off-the-books, work is, of course, secretive. Fluid scheduling of employees in large organizations is typically handled by software like Kronos Workforce Central 8. We don’t know how individual customers configure sophisticated functionality that can cut labor costs while maintaining precise service levels.

 

 

Eight problems (so far)

To lift-the-covers on the new world of de-regulated, tech-enabled, fluid workforces, we have to turn to publicly scrutinized gig work platforms. Uber is a recurring reference. Stratospheric valuations make them a role model for any start-up labor market and gets journalists probing. Here’s a current issue list:

 

180207 HRThe high-profile issues

1) Misclassification: Are platform gig-workers employees of the platform? It’s going backwards and forwards in the courts. If they are only independent contractors, they get no benefits, little protection and can be easily dropped. That’s great for platform profitability. Commercial labor markets are lobbying hard for this model.

2) Benefits: If healthcare is provided by your employer, what happens to those with ever changing employers, each assuming benefits are someone else’s issue? The Affordable Care Act may no longer be the solution many hoped for. Absent widespread portable benefits, many gig workers live in terror of illness or accident.

 

Some less understood challenges

3) Limited exposure: Any work-seeker wants exposure to as many potential hirers as possible. It doesn’t happen for irregulars. Assume, to take one study, you sought work doing deliveries of food in Seattle in 2014; potential buyers of your time were divided between fiercely competitive markets like Eat24GrubHubPostmatesMuncheryPeachdLishBitesquad and Caviar. But a year later, it all changed: Amazon launched a food delivery exchange in Seattle then Uber muscled in.

160216 Bad gigsWhere should you have invested time building a track record? You couldn’t know; each site guards its sales data and plans. For maximum exposure to food delivery work you needed to trade across all these services at once.

It can’t be done: algorithms running Market A will downgrade you if not available for an assignment because you’re doing a booking from Market B. You have to bet on a small number of markets at most. That’s like each job-seeker having to decide which 5%, or less, of employers would be the only ones whose openings they could ever view.

 

4) Lack of progression: To improve your options you need to monitor sectors. As well as food, you may be willing to – for example – deliver fuel to cars. There seems to be demand, and now marketplaces, in multiple cities, each with funds to expand. So, do you bet on the eventual success of FilldPurpleFuelMeNeighborhood Fuel or Fueldrop? Or wait for someone else to come in later? Or accept the entire sector might be closed down?

But endless delivery runs may not be your life aspiration. There might be a local shortage of roofers, beauticians, tutors or other gigs of interest. You don’t know. There is no market data to tell you. Compare that to public support and insights underpinning job searches.

 

180207 Ordinary5) Overheads of getting work: Registering on gig work sites takes time, even though they may have no work for you. Waiting for messages, beating other work-seekers to respond to a gig, dropping everything to fulfill it even though it might be inadequately or unfairly described; these are all costs of gig working. Apart from some upfront vetting, platforms can push overheads of sign-up and scheduling onto work-seekers.

 

Further problems emerge each year

6) (2015) Market closures: Thousands were cleaning homes through Homejoy when investors lost interest and pulled the plug. Hirer relationships, track-records and immediate work evaporated leaving work-seekers, who may have strived to do well, to start again at the bottom of another market. A wave of shutterings followed: Prim and Washio (on-demand laundry) Rewinery (wine deliveries), Kitchit (meals cooked in your home), Cherry (car washes) and countless other markets claiming to empower independent workers. Exchanges coming perilously close to implosion strive to conceal it.

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7) (2016) Sudden pay cuts: Uber slashed workers’ rates while increasing its own cut in January. Investor enthusiasm then boosted Uber’s funding to develop a driverless future. Other markets followed.

controlHave you heard that Uber has become kinder, gentler, since then? Parsing the financials shows drivers’ share of fares is still falling. Is this making you feel good about using Lyft? They started it.

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8) (2017) Management by algorithms: Go through a bad patch in a job and you might get a warning, possibly some support in improving. Get poor ratings on a gig platform and work can just disappear. The black-box sophistication of these apps is driving buyer convenience and operator profitability, not a supportive labor market. Uber has produced code to mislead regulators, systematically encouraged drivers to keep working with diminished chance of pay, allegedly set out to knowingly undermine other marketplaces and encouraged what’s been called “modern share cropping”.

 

These problems come together in often desperate financial volatility. 92% of Americans would now rather just be financially stable than move up the income ladder.

 

Searching for solutions

Policymakers are looking at creating new categories of worker with responsibilities spread across multiple employers. Courts are pressuring “gig” work markets to recognize rights and collectivization for workers. Numerous charities are probing labor market problems for women, immigrants, youth, dislocated workers or low-income households in a given area.

180207 GoverningA few cities are outlawing ad-hoc scheduling. Elsewhere, states have pre-empted cities’ right to do this. Where flexible scheduling is curtailed, an array of platforms will send gig workers to replace employees.

 

Entrepreneurs are – of course – addressing inefficiencies for buyers and sellers. Alfred works across multiple markets to meet buyers’ needs. Peers subjectively ranks individual markets. Sherpashare merges individual’s data from all rideshare services. Credly and Traity tackle lack of co-ordinated track records. Stride healthcare, Honest Dollar and Policy Genius target financial products at “gig” workers. Marketplaces run as co-operatives are getting some traction. But Juno provides a salutary lesson in how well-intentioned markets can struggle to survive.

180207 JunoBut administering new rules – or building add-ons – across basic, unstable, ring fenced, regulator-resistant markets may not be the only way to a solution.

It could be we have a problem in the foundations: This sprawling part of the workforce needs access to solid local marketplaces. They have to be genuinely, sustainably, built around workers’ development and alignment with employers’ needs.

 

How big is this?