Gig economy

The gig economy and labor rights

According to the Israeli newspaper Haaretz, a report studying freelancers published by consulting firm Mackenzie said that the gig economy has done away with workers’ rights achieved through decades of activism and legislation. Mackenzie concluded that freelancers face labor conditions similar to those of workers before the Industrial Revolution.

The advantage for employers is clear, as working with freelancers offers companies managerial flexibility. They pay for the services of a person as if that person were an entire company, without any obligation to provide social benefits or fulfill labor laws. It turns the employer–employee relationship into a customer–supplier one, which can be very unequal.

A report by the Upwork and Freelancers Union forecasts that by 2027, some 50% of all U.S. workers will be freelancers. Mackenzie estimates that the current proportion is around 20-30%, which includes people who supplement their income through freelance work.

The gig economy

The gig economy will become mainstream in the office within the next five years and life as an employee will "fundamentally change," a CEO that works with 30% of the Fortune 100 has said.

Catalant runs a matchmaking service that connects companies with professionals on-demand for specific projects. Users sign up through the website or access the service via a number of consulting firms that Catalant works with. Their profile is then put in front of company managers that are hiring for projects and at the end of the work the employee is given a rating.

The Gig Economy

Transport for London has announced it will not renew ride-sharing app Uber’s license because it has identified a “lack of corporate responsibility” in the company. But did the company deserve to have its licence revoked?

Uber has always maintained its drivers are not directly employed by the company; rather, they are self-employed contractors who are connected to drivers through a platform. But Labour MP Frank Field said, “They are not paying sick leave or contributing to pensions. Yet it seems likely that their employment practices will lead more people to need taxpayers to pick up these costs.”

Wider concerns about the so called ‘gig economy’ have also been cited. Almost 5 million people currently work in these short-term, temporary jobs in the UK.

Toyota invests in an Asian Uber

Japanese automotive giant Toyota has made a strategic investment in South East Asia taxi-hailing service Grab.

Grab, which competes with Uber, announced on Wednesday that Toyota is investing in a $2 billion (£1.6 billion) plus funding round that was announced in July. Other investors in the round include Japanese tech firm SoftBank and its Chinese equivalent, Didi Chuxing.

Grab—which currently offers services in 87 cities across Singapore, Indonesia, Philippines, Malaysia, Thailand, Vietnam and Myanmar—has raised around $3.5 billion (£2.7 billion), according to Crunchbase.