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The gig is up: America's booming economy is built on hollow promises

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From The Guardian

Contract workers prop up big earners but under Trump's anti-labor administration are ruthlessly exploited themselves

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Uber just filed its first quarterly report as a publicly traded company. Although it lost $1bn, investors may still do well because the losses appear to be declining.

aren't doing well. According to a recent study, about half of New York's Uber drivers are supporting families with children, yet 40% depend on Medicaid and another 18% on food stamps.

It's similar elsewhere in the new American economy. Last week, the New York Times reported that fewer than half of Google workers are full-time employees. Most are temps and contractors receiving a fraction of the wages and benefits of full-time Googlers, with no job security.

Across America, the fastest-growing category of new jobs is gig work contract, part-time, temp, self-employed and freelance. And a growing number of people work for staffing firms that find them gig jobs.

Estimates vary but it's safe to say almost a quarter of American workers are now gig workers. Which helps explain why the standard economic measures unemployment and income look better than Americans feel.

The jobs problem today isn't just stagnant wages. It's also uncertain incomes. A downturn in demand, change in consumer preferences, or a personal injury or sickness, can cause future paychecks to disappear. Yet nearly 80% of Americans live paycheck to paycheck.

According to polls, about a quarter of American workers worry they won't be earning enough in the future. That's up from 15% a decade ago. Such fears are fueling working-class grievances in America, and presumably elsewhere around the world where steady jobs are vanishing.

Gig work is also erasing 85 years of hard-won labor protections.

At the rate gig work is growing, future generations won't have a minimum wage, unemployment insurance, worker's compensation for injuries, employer-provided social security, overtime, family and medical leave, disability insurance, or the right to form unions and collectively bargain.

Why is this happening? Because it's so profitable for corporations to use gig workers instead of full-time employees.

Gig workers are about 30% cheaper because companies pay them only when they need them, and don't have to spend on the above-mentioned labor protections.

Increasingly, businesses need only a small pool of "talent" anchored in the enterprise innovators and strategists responsible for the firm's competitive strength.

Other workers are becoming fungible, sought only for reliability and low cost. So, in effect, economic risks are shifting to them.

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Robert Reich, former U.S. Secretary of Labor and Professor of Public Policy at the University of California at Berkeley, has a new film, "Inequality for All," to be released September 27. He blogs at www.robertreich.org.

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