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Uber, Airbnb, and the 'share-the-scraps' economy

Uber, Airbnb,Instacart, and other multibillion dollar startups make up what is referred to as the 'share economy.' A more accurate term would be the 'share-the-scraps' economy,' one that allows workers to patch together barely enough to live on. 

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Jeff Chiu/AP/File
Lyft passenger Christina Shatzen gets into a car driven by Nancy Tcheou, in San Francisco. Reich argues that Uber, Lyft, and AirBnb represent the logical culmination of a process that began thirty years ago when corporations began turning over full-time jobs to temporary workers, independent contractors, free-lancers, and consultants.

How would you like to live in an economy where robots do everything that can be predictably programmed in advance, and almost all profits go to the robots鈥 owners?

Meanwhile, human beings do the work that鈥檚聽unpredictable 鈥 odd jobs, on-call projects, fetching and fixing, driving and delivering, tiny tasks needed at any and all hours 鈥 and patch together barely enough to live on.

Brace yourself. This is the economy we鈥檙e now barreling toward.

罢丑别测鈥檙别听听诲谤颈惫别谤蝉,听聽shoppers, and聽hosts. They include聽听箩辞产产别谤蝉,听鈥檚 on-demand attorneys, and聽鈥檚 on-line doctors.

罢丑别测鈥檙别.听

The euphemism is the聽. A more accurate term would be the 鈥渟hare-the-scraps鈥 economy.

New software technologies are allowing almost any job to be divided up into discrete tasks that can be parceled out to workers when they鈥檙e needed, with pay determined by demand for that particular job at that particular moment.

Customers and workers are matched online. Workers are rated on quality and reliability.

The big money goes to the corporations that own the software. The scraps go to the on-demand workers.

Consider Amazon鈥檚 鈥淢echanical Turk.鈥 Amazon calls it 鈥.鈥

In reality, it鈥檚 an Internet job board offering minimal pay for mindlessly-boring bite-sized chores. Computers can鈥檛 do them because they require some minimal judgment, so human beings do them for peanuts 鈥 say, writing a product description, for $3; or choosing the best of several photographs, for 30 cents; or deciphering handwriting, for 50 cents.

Amazon takes a healthy cut of every transaction.

This is the logical culmination of a process that began thirty years ago when corporations began turning over full-time jobs to temporary workers, independent contractors, free-lancers, and consultants.

It was a way to shift risks and uncertainties onto the workers 鈥 work that might entail more hours than planned for, or was more stressful than expected.

And a way to circumvent labor laws that set minimal standards for wages, hours, and working conditions. And that enabled employees to join together to bargain for better pay and benefits.

The new on-demand work shifts risks entirely onto workers, and eliminates minimal standards completely.

In effect, on-demand work is a reversion to the piece work of the nineteenth century 鈥 when workers had no power and no legal rights, took all the risks, and worked all hours for almost nothing.

聽use their own cars, take out their own insurance, work as many hours as they want or can 鈥 and pay Uber a聽. Worker safety? Social Security? Uber says it鈥檚 not the employer so it鈥檚 not responsible.

Amazon鈥檚 Mechanical Turks work for pennies, literally. Minimum wage? Time-and-a half for overtime? Amazon says it just connects buyers and sellers so it鈥檚 not responsible.

Defenders of on-demand work emphasize its flexibility. Workers can put in whatever time they want, work around their schedules, fill in the downtime in their calendars.

鈥淧eople are monetizing their own downtime,鈥 Arun Sundararajan, a professor at New York University鈥檚 business school, told the聽New York Times.听

But this argument confuses 鈥渄owntime鈥 with the time people normally reserve for the rest of their lives.

There are still only twenty-four hours in a day. When 鈥渄owntime鈥 is turned into work time, and that work time is unpredictable and low-paid, what happens to personal relationships? Family? One鈥檚 own health?

Other proponents of on-demand work point to studies, such as one recently commissioned by聽, showing Uber鈥檚 on-demand workers to be 鈥.鈥

But how many of them would be happier with a good-paying job offering regular hours?

An opportunity to make some extra bucks can seem mighty attractive in an economy whose median wage has been stagnant for thirty years and almost all of whose economic gains have been going to the top.

That doesn鈥檛 make the opportunity a great deal. It only shows how bad a deal most working people have otherwise been getting.

Defenders also point out that as on-demand work continues to grow, on-demand workers are joining together in聽聽to buy insurance and other benefits.

But, notably, they aren鈥檛 using their bargaining power to get a larger share of the income they pull in, or steadier hours. That would be a union 鈥 something that Uber, Amazon, and other on-demand companies don鈥檛 want.

Some economists laud on-demand work as a means of utilizing people more聽.

But the biggest economic challenge we face isn鈥檛 using people more efficiently. It鈥檚 allocating work and the gains from work more decently.

On this measure, the share-the-scraps economy is hurtling us backwards.

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