Can Workers Come Out Ahead? How to make gig work good for all of us.scroll down arrow

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Essay

Can Automation Turn Fewer Jobs Into Better Ones?

The cruelest hoax of the automation revolution that is now in the first stages of transforming the nature of work is the suggestion that it will play out as the industrial revolutions of the past: with people, perhaps grudgingly, perhaps happily, moving from one kind of work to another. That’s not going to happen.

John Nichols

John Nichols is the Washington correspondent for The Nation magazine and associate editor of The Capital Times of Madison, Wisconsin. Co-founder of Free Press, John is also an author and co-author of multiple books, including the recently published People Get Ready: The Fight Against a Jobless Economy and a Citizenless Democracy.

This revolution is moving people out of work altogether. Digital applications and automation innovations are creating a future where robots will do most of the work that was once performed by human beings. Bizarrely, shamefully, this reality continues to be obscured and even at times denied by elite analysts who spin the fantasy that the future of work will follow the familiar patterns of the past.

It won’t. Capitalism guarantees that this revolution will be dramatic. The only question facing the great mass of Americans who are not currently occupying the top rungs of the economic ladder is whether it will be dramatically worse or dramatically better. For those of us who prefer the dramatically better option, honest recognition of where we are and where we are headed is essential.

The multinational corporations that already profit from the dislocation and disorientation of workers continue to peddle old understandings of industrial change to maintain that work is simply evolving and that workers need only adapt to new opportunities. A chipper headline from The Atlantic in January promised to explain “Why Computers Aren’t Going to Steal Everyone’s Jobs.”

But consider the case of Uber, the multinational ride-sharing conglomerate that advertises incessantly about the employment prospects it offers those who have been displaced from steadier work (and the security associated with it). Its radio ads promise drivers a quick route to prosperity.

The only question facing the great mass of Americans who are not currently occupying the top rungs of the economic ladder is whether it will be dramatically worse or dramatically better.

“How many different driving jobs are there?” Uber’s website asks. “A lot,” it answers. In fact, the most popular driving job in the United States is truck driving, which employs about 3.5 million people. Uber has only been around since 2012. “Despite this,” its website claims, “it’s growing the fastest because of the great earning potential and flexible schedule.”

What is not mentioned is that, in 2015, Uber hired 40 scientists and researchers—yes, 40—from Carnegie Mellon University’s National Robotics Engineering Center to envision “autonomous cars that could someday replace its tens of thousands of contract drivers,” explained The Wall Street Journal.

In our research for People Get Ready: The Fight Against a Jobless Economy and a Citizenless Democracy, Bob McChesney and I found countless examples of corporations investing in research designed to replace the jobs of the future with robots, automation schemes, and digital applications. No matter what the starry-eyed futurists may tell you, corporations are not going to create millions of new robot-repair and oversight positions to fill the void that is being created. Nor will there be enough positions for software designers and managers to maintain a middle class. Companies are not going to pour resources into automation while at the same time creating jobs for displaced and downsized workers—doing so would negate the very profits they seek.

In this new age, old models for employment must be replaced. There will still be work, but there will be less of it. Will the work that remains be viciously exploitative, with workers pitted against one another in a fight for the last job? Or will workers begin to think of themselves as citizens of a new era, when the promise of technological progress can be made real?

Automation can and should eliminate drudgery, freeing people to work fewer hours for fairer compensation and to devote themselves to social advancement. To do this, however, citizens must assert themselves by demanding not just political but economic democracy. We must replace fantastical talk about “the future of work” with the honest understanding that there will be less work. We must shape a humane future in which corporate monopoly and inequality give way to a sharing society where technological progress benefits everyone.

John Nichols

John Nichols is the Washington correspondent for The Nation magazine and associate editor of The Capital Times of Madison, Wisconsin. Co-founder of Free Press, John is also an author and co-author of multiple books, including the recently published People Get Ready: The Fight Against a Jobless Economy and a Citizenless Democracy.

The Next Big Thing: Benefits That Go Where You GoAmerica’s social safety net was designed for a different labor market and economy

Thomas Fisher, professor at the College of Design at the University of Minnesota, is a gig economy enthusiast. At a conference talk last spring, he touted it as a building block in the creation of a high-tech version of the traditional village economy. In this new community-based economy, he said, collaboration will trump competition, the pursuit of experience will replace the desire to own, workers will enjoy flexible jobs and multiple careers, and consumers will be producers.

Chris Farrell

Chris Farrell is senior economics contributor at Marketplace. He is economics commentator for Minnesota Public Radio and host of its series “Conversations on the Creative Economy.” Chris lives in St. Paul, Minnesota.

Social Saftey Nets:
Then, Now, and Onward

Take a look at two lives as they're influenced by their jobs and the benefits that come with them (or rather, the ones that don't).

YES! Illustrations by Jennifer Luxton

A skeptical audience member questioned his enthusiasm: Isn’t the gig economy a worker dystopia with low wages, no benefits, and job insecurity?

“We are in the early Industrial Revolution phase once again, and like then there is a lot of inequality,” Fisher replied. “We’ll need to develop laws and public policy to handle it.”

There’s the rub.

For workers, the gig economy offers the tantalizing prospect of greater opportunities for entrepreneurship, flexible jobs, and a variety of careers. But turning that promise into reality will take a major overhaul of America’s social safety net, which was designed for a different labor market and economy. (Think 1950s and a gold watch at retirement.) The fundamental priority of the gig economy era should be to attach safety net benefits—especially retirement savings and health insurance—to the individual or household rather than to the employer.

“You’re giving people access to the benefits they care about, and, if they aren’t attached to the employer, workers could be choosier about the jobs they take,” says Lane Kenworthy, sociologist at the University of California, San Diego, and author of The Good Society.

Is this a pie-in-the-sky concept? Hardly. We’ve made a comparable social transformation before.

In the late 19th century, a majority of workers labored long hours at hazardous, arduous jobs. Most workers didn’t have vacations, let alone pensions. A patchwork quilt of state and local programs and charitable organizations offered some relief to the jobless. But those efforts were limited, and job insecurity was part of working life.

The foundation for the modern social safety net was laid during traumatic years.

The 1935 Social Security Act provided support to the elderly and disabled in the midst of the Great Depression. Laid-off workers got financial relief with unemployment insurance. The Fair Labor Standards Act of 1938 included a national minimum wage and overtime rules. During World War II, large employers offered employees health insurance and pension benefits (though largely as a means of getting around a national wage freeze). The Employee Retirement Income Security Act of 1974 (ERISA) strengthened pension and health insurance protections. Labor laws like these were designed to provide workers with greater economic security. The baseline assumption was that the typical employee worked full time for a single employer. These laws still hold sway.

Imagine a worker named Jill. She worked out of a cubicle in the corporate headquarters for a major national retailer for nearly two decades. She participated in her employer-sponsored retirement savings plan and health insurance benefit. She earned the federal minimum wage when she started in 1990, and, early in her career, got extra money from overtime.

You’re giving people access to the benefits they care about, and, if they aren’t attached to the employer, workers could be choosier about the jobs they take."
— Lane Kenworthy, sociologist at the University of California, San Diego

Jill lost her job in 2008 during the recession. She filed for unemployment benefits to tide her over. She used COBRA to keep her employer’s health insurance plan in place. (The 1986 Consolidated Omnibus Budget Reconciliation Act let workers keep their group health plan for up to 18 months after leaving.) She could no longer contribute to her 401(k) since she wasn’t on payroll, so she rolled it over into an IRA. Jill found another full-time job three months later. Her safety net is intact.

America’s modern social safety net for the typical worker was a genuine break with the past and a vast improvement over what came before. The problem is Jill’s segment of the workforce—the single employer, full-time worker—has been shrinking while the ranks of America’s contingent workers, such as independent contractors and freelancers, are swelling. The Government Accountability Office estimates some 40 percent of the workforce is contingent, up from 31 percent in 2005.

That’s because contingent gig workers are exempt from most labor laws and, therefore, much cheaper for employers. Management has restructured, downsized, rightsized—pick your favorite euphemism. Jobs are less secure, wages are stagnant, and income inequality is high and rising.

Contrast Jill’s situation to that of Robert. He graduated from college in 2004. He never managed to land a full-time job, so he has always been an independent contractor. His clients paid him decently for completing projects, although they usually stretched out payments from 30 to 90 days when business slowed. As an independent contractor, he wasn’t eligible for minimum wage, over-time, workers’ compensation, or Family Medical Leave Act benefits. He couldn’t participate in his clients’ employer-sponsored retirement and health insurance plans. He pays the full 15.3 percent payroll tax. But when Robert lost his clients in 2008 during the recession, he wasn’t entitled to file for unemployment benefits. His safety net is full of holes, which makes it financially hard for him and his wife to plan and raise their two young daughters. His wife works at part-time and temporary jobs, so she doesn’t qualify for benefits either.

So how do we ensure that the jobs that do exist provide quality support? The answer lies in broadening the social safety net from its single-employer, full-time worker model to a universal framework that accommodates self-employment, gig work, contingent work, and multiple part-time jobs.

Take retirement savings. There have been a number of savvy proposals for establishing a universal retirement savings plan during the past few presidential administrations, Republican and Democratic alike. The basic idea usually involves providing everyone with an IRA or 401(k)-type account with government matching benefits. For example, Gene Sperling, the former director of the White House National Economic Council under Presidents Bill Clinton and Barack Obama, suggests a version of a universal 401(k). Lower- and middle-income Americans would receive a dollar-for-dollar matching credit of up to $4,000 annually per household. Higher income households would get at least a 60 percent match. This would also be available through IRA contributions for the self-employed and those temporarily not working.

So how do we ensure that the jobs that do exist provide quality support? The answer lies in broadening the social safety net from its single-employer, full-time worker model to a universal framework that accommodates self-employment, gig work, contingent work, and multiple part-time jobs.

Health insurance plans should reflect the needs of a mobile workforce. The Obama administration’s Affordable Care Act took a huge step toward improved portability with the insurance exchanges. For the first time, individuals and families, regardless of their employment status, have access to comprehensive and affordable health coverage. Longer term, America’s employer-centered health insurance system should be eliminated in favor of a Medicare-for-all plan.

Still, the most intriguing universal benefit gaining traction is a guaranteed minimum income or universal basic income. The idea is that everyone would get periodic income payments with no conditions attached beyond citizenship. The amount proposed is usually in the $10,000-a-year range.

This concept garners support from both conservatives and liberals, although for very different reasons. Conservative theorist Charles Murray of the American Enterprise Institute promotes a $13,000 universal basic income (with $3,000 of that amount dedicated to buying health insurance). In exchange, he wants to scrap all antipoverty and social welfare programs. More liberal proponents of the idea don’t buy that aspect of his proposal, especially if payments are limited to $10,000. Instead, they see a universal basic income as a way to dramatically reduce poverty—in essence, by establishing an income floor for the poorest Americans that would supplement, rather than replace, a range of existing anti-poverty programs like Medicare.

The income is “equivalent to recognizing shared ownership of a significant fraction of the resources, physical and intellectual, that enable the society to produce what it produces,” explained the late economist and Nobel laureate Herbert Simon.

What might universal benefits mean to the typical worker?

Let’s say Maria works full time at an advertising agency. She is unhappy with her new manager and quits her job. She picks up some gig economy work to supplement her universal basic income while she decides what to do next. She’s making enough to keep contributing to her retirement savings. She keeps her health coverage too.

Health insurance plans should reflect the needs of a mobile workforce.

One Strategy:

Let Cities and States Take the Lead on Portable Work Benefits

Ideally, policies behind portable individual work benefits and safety nets would be enacted at a national level so that all employers are subjected to the same rules. But that doesn’t mean they have to join the many dusty skeletons of social policies waiting for action from Congress.

One strategy suggested by Steven Hill, author of Raw Deal: How the “Uber Economy” and Runaway Capitalism Are Screwing American Workers, is for such a program to get its start at the city or state level.

Hill points to the four states (California, Connecticut, Oregon, and Massachusetts) and 18 cities (including Washington, D.C., New York City, Philadelphia, and Seattle) that have passed paid sick leave policies. Similar strategies could be used by cities and states to require employers to pay into general individual security accounts.

San Francisco’s been there and done that, with a 2006 ordinance that requires large employers, including restaurants that often don’t provide health care, to set aside a few dollars per hour for each employee’s health—even if they’re paid under a 1099 tax form. The ordinance even created city-operated Medical Reimbursement Accounts, which make it easy for multiple employers to pay into a single worker’s benefits.

As more workers join the gig economy, local laws like San Francisco’s can provide a time-tested model for D.C. legislators seeking solutions. —YES! Editors



Return to the story

Eventually, she decides to start her own social media consulting business. She does well for a year, but business dries up in a recession. She files for unemployment insurance, which supplements her universal basic income. She realizes that she enjoyed entrepreneurship, but she wasn’t good at finding clients. She joins several gig economy platforms that find her business while allowing her to exercise control over her schedule. At no point in this journey does she lose her retirement savings or health insurance. The combination of unemployment insurance and the universal basic income give her time to think through her options.

A shift toward universal benefits rather than employer-based benefits would encourage workers to embrace the variety that the gig economy (broadly defined) offers. That sense of freedom would also force management to pay more attention to their workers and pay them higher wages. Yes, genuine design differences exist among various universal benefit proposals, but embracing the principle should shape a new social compact, one better suited to a high-tech, internationally integrated economy.

Social Saftey Nets:
Then, Now, and Onward

Take a look at two lives as they're influenced by their jobs and the benefits that come with them (or rather, the ones that don't).

YES! Illustrations by Jennifer Luxton

Social Saftey Nets:
Then, Now, and Onward

Take a look at two lives as they're influenced by their jobs and the benefits that come with them (or rather, the ones that don't).

YES! Illustrations by Jennifer Luxton

Chris Farrell

Chris Farrell is senior economics contributor at Marketplace. He is economics commentator for Minnesota Public Radio and host of its series, “Conversations on the Creative Economy.” Chris lives in St. Paul, Minnesota.

Essay

Did Working Moms Dream Up the Gig Economy?

I typed away at a makeshift standing desk in my living room, the baby bouncing in her carrier on my chest. I usually started work at 6 or 7 a.m. to ensure I could sign off when our nanny had to leave on the four days a week we had her. But some days I couldn’t stop early enough.

Anne Miller

Anne Miller is a freelance editor, writer, and occasional essayist who manages corporate publications and other content marketing editorial projects. She lives and works in Brooklyn with her husband and their preschool-aged daughter.

This is my career after having a kid. I work at least 35 hours a week, often more. I work around child care and holiday schedules. I work early mornings, and I work weekends. I work from home and hustle for clients because we can’t live on one income. Also, we would need at least 10 hours of daily child care if my husband and I both commuted to traditional office jobs.

There’s an argument for changing systems from within. Break the glass ceiling, extend a hand, pull others up behind you. But how do we find the energy to break the glass ceiling on four hours of sleep, with a sick kid, a working spouse, no family around, and a strained bank account? School hours and office hours don’t match, leaving parents scrambling for after care. Even if a parent has two weeks of vacation, summer break from school lasts five times that and day camps get expensive. For many, including myself, the gig economy is the only way the math works. We can’t afford not to work, and we enjoy our careers. But we can’t afford enough child care to cover the work and commute hours of a traditional job—and also, we’d like to see our kids before bedtime.

Shannon Joyce Neal was 30 with a toddler at home when the major metro daily newspaper where she worked offered her a promotion to business editor.

Instead, she walked away.

“I tried to be the change from within,” Joyce Neal says of a job with 60-hour work weeks. She wouldn’t have seen her son during the week. All the evening child care would fall to her husband, who also worked full time. “I asked for the flexibility, and they said no. Do I keep pushing forward in a situation where I don’t feel it’s a good choice, or do I come up with another option?”

Her son won out. She quit and took occasional freelance work. For her and others, the gig economy offered what many workplace and government policies don’t: room to stay in the professional game and also meet the needs of a growing family.

My own career track involved newspaper reporting for a decade before moving online, juggling breaking news for an audience of millions.

And then I had a kid.

And then my full-time, work-from-home editing contract ended. I didn’t have a plan, really. A startup offered me work, and I landed some corporate writing assignments. A freelance career launched. I’ve yet to meet fellow parents in a two-income household who don’t suffer some permanent state of anxiety trying to figure out schedules and money. We do too, but at least I can keep editing, keep writing, and stick dinner in the oven while I work or clean dishes during conference calls.

Joyce Neal had a second child who developed a seizure disorder. Child care outside the home wasn’t an option. Returning to work full time remained impossible.

Continuing her occasional freelancing “was rewarding, to … do something that I felt I was good at and that I was contributing and that was wholly separate from that parenting identity,” she says.

In her sentiments I hear my own. Maybe this is the new “having it all,” balancing some form of my needs and my daughter’s without giving up one or the other.

Someday I may return to an office position. Life happens. But for now, with a young child and my skill set, I’m embracing freelance work. I drafted this essay on a weeknight while my husband handled bath time and bedtime, and I edited sections at our local YMCA while my now preschool-age daughter took ballet.

Maybe it’s selfish, but right now I’m not worried about the glass ceiling. I’m more worried about what to do with a sick kid and a spouse out of town. If enough of us freelancer parents are that selfish, maybe we’ll create a new normal.

Anne Miller

Anne Miller is a freelance editor, writer, and occasional essayist who manages corporate publications and other content marketing editorial projects. She lives and works in Brooklyn with her husband and their preschool-aged daughter.

The Emotional Toll of FreelancingHow to cope with anxiety, self-doubt, and "the check's in the mail"

YES! Illustration by Jennifer Luxton

YES! Illustration by Jennifer Luxton

I am currently waiting for around $10,000 worth of paychecks to reach me for freelance writing projects I’ve done. Most of these projects were completed months ago. Some editors have since gone silent, leaving me to wonder if I’ll ever see my money. My partner is a dentist, so I am not going to starve, but it’s still frustrating to be unable to plan my finances like traditional workers.

Brandon Ambrosino

Brandon Ambrosino has written for The New York Times, The Boston Globe, The Atlantic, BBC, The Economist, and Politico. He lives with his partner, Andy, in Delaware.

Not getting paid impacts my sense of identity too. When I don’t get paid — or paid on time — or I have an assignment killed or don’t hear from an editor, I second-guess myself and the work I’m doing. I wonder whether I’m being honest when I tell people I’m a writer. I wonder if it’s accurate to say I have a job.

And because the second question we often ask a new acquaintance is what they do for work, these self-doubting questions lead to an enormous amount of stress and anxiety for me.

According to a recent study from Roosevelt University, I’m not alone. Many freelancers regularly experience anxiety, frustration, anger, and depression.

Gianpiero Petriglieri, a psychiatrist and associate professor at the graduate business school INSEAD, studies the psychology of gig workers.

“We join organizations for a defense against anxiety,” says Petriglieri. “They give life a sense of security.” Gig workers, on the other hand, can struggle to find security, a sense of purpose, and fulfillment. While the traditional office offers a stable paycheck and shared responsibilities, freelancers are responsible for all aspects of their business, including marketing.

A 2004 study found that the cyclical nature and 24/7 brand management required by independent work creates “more rather than fewer constraints on workers’ time.” Freelancers are never not on the clock — that’s physically and emotionally fatiguing. Gig workers also feel anxiety over what Irvin Schonfeld, a psychology professor at City College of New York, calls “reputational threat” — the concern that one client’s bad review is all it takes to make them unemployable.

Despite the challenges of gig work, many freelancers are able to “transform their anxiety from something debilitating to a source of learning and growth,” says Petriglieri.

So how do they do it?

The following suggestions come from the research of Petriglieri and others, as well as from freelance workers who have found ways to navigate the psychological obstacles they encounter in their work.

1. Plan ahead.

Seven in 10 freelance workers have trouble getting paid on time, according to Sara Horowitz, founder and director of Freelancers Union. To chase down their paychecks, many freelancers have to take time away from other activities, which means non-payment and late payment are doubly taxing. “Savvy freelancers will build in padding in their rates to compensate for potential client nonpayment,” says Horowitz. They’ll also learn to live on a budget and save up big paychecks for rainy days.

2. Foster connections.

“You’re so lucky to get to work from home!” If I had a nickel …

In fact, working in isolation is the source of a lot of freelancers’ anxieties. In a traditional company, failures are shared. When a freelancer learns his pitch was rejected, his gig was killed, or his paycheck is MIA, he has to shoulder that burden alone.

To address this issue, Sara Frandina, a content strategist in Rochester, New York, co-created One Woman Shop, an online community and resource to help female solo business owners connect. Frandina thinks connecting with other freelancers is paramount for their success.

“Finding a community of like-minded individuals has been key to getting out of my own head, building in accountability, having productive conversations, and feeling like I’m not alone in this business journey,” she says.

3. Catch as catch can.

“My strategy is to not turn down any work that’s offered to me that pays well,” says Matt Brennan, a freelance reporter and film/TV critic based in New Orleans. Successful freelancing, he says, is basically “catch as catch can,” meaning gig workers should take advantage of opportunities that come their way — even if it’s not a dream job. As long as corporate gigs don’t require a freelancer to compromise her integrity, what’s the harm in writing a travel blurb for an airline magazine or creating a photo spread for a restaurant?

Schonfeld says this mentality is critical to success as a freelancer. “Every job has [a] certain amount of conformity and autonomy. Even when you’re self-employed, you do have to conform to customers’ expectations — otherwise you won’t get by.”

4. Know your value.

Magdalyn Duffie, a 32-year-old freelance graphic designer who specializes in social media, websites, and art installations, says she sometimes has to deal with impostor syndrome, the feeling that she doesn’t deserve her success. Duffie, based in Raleigh, North Carolina, says she feels this the moment she sends off an invoice, when she puts “a number to the skill.”

Although it can be tough, self-employed workers need to learn to stand up for themselves financially, says Duffie. More often than not, she says, the companies you’re working for can afford it.

So, she says, roll up your sleeves and tell yourself, “I am good. I can do something that is worth hard cash.”

5. Ditch the word “should.”

“It’s easy to [think] we ‘should’ be doing specific things [when] we see other people we deem successful doing those things,” says Frandina. That musician landed a gig with the symphony. That dancer booked a Broadway show. That writer had a cover story in The Wall Street Journal.

We rarely know the story behind other people’s successes. “It’s all too easy to compare our beginning to someone else’s middle,” says Frandina. “Success is a relative term.”

Perhaps a little grass-is-always-greener wisdom might help here. I’m regularly surprised to hear that freelance writers I’m jealous of are actually jealous of my accomplishments.

6. Have a sense of purpose.

Of the freelancers Petriglieri interviewed, those with a clear sense of purpose were better able to manage their anxiety. For example, if they were writers, he said, they wouldn’t say they “just write.” They’d say something like, “I try to change people’s perception of this issue.” Same thing with musicians: They don’t “just make music” — they enrich others’ lives through art.

Keeping my sense of purpose in mind motivates me on those days when inspiration doesn’t strike. Then, I file invoices, update my calendar, send pitches, and clean my work space — all the things I have to do if I want to call myself a writer.

Gig work isn’t new, but the sheer size of the industry is. If projections are to be believed, 40 percent of U.S. workers could be freelancers by 2020. That means conversations about self-employment and mental health are becoming increasingly important.

In the meantime, I’ll update my editorial spreadsheet to show I completed another article. And I’ll look forward to receiving my paycheck in two to three months.

Editor’s note: We paid him.

Brandon Ambrosino

Brandon Ambrosino has written for The New York Times, The Boston Globe, The Atlantic, BBC, The Economist, and Politico. He lives with his partner, Andy, in Delaware.