Tag Archives: #lyft

Few Gigs Left In The Gig Economy

My daughter recently moved to the Bay Area. She has a new job, her first out of college, but viewed the move with trepidation. Could she and her roommates afford west coast rents on their modest salaries? They worried about returning to their old bargain basement digs – unsavory but inexpensive – it got broken into twice, and one night they awoke to find a passerby smashing in their car windscreen with a brick.

They wanted safe – but could not afford it.

The hunt was on. The onset of COVID19 had driven all three home to their parents. But understandably, the itch to get on with grown up lives even in the new normal, intensified their search.

After four months of trawling through rental property websites, an Airbnb host offered the trio her charming San Francisco apartment at an incredible discount – much to their disbelief, it was well below its listing price. It appears that after the owner’s business took a nosedive in the pandemic, she was prepared to take a chance on newly minted graduates, offering them a long term rental they could just about afford.

Many gig workers like my daughter’s new Airbnb landlady took a hit when the pandemic struck. Once, they were the face of a thriving gig economy  – Airbnb reported that its women hosts earned nearly $15 billion in the last year alone.. But as the pandemic unceremoniously sank the economy, forcing businesses to shut and jobs to vanish under the threat of infection, many gig workers – Airbnb hosts, Uber drivers, dog walkers, babysitters, Task Rabbit ‘taskers’ – faced with the prospect of layoffs, reduced hours and pay, had to invent new ways to supplement incomes in order to survive.

Dr. Alexandrea Ravenelle

“Quite frankly, now is not a good time to be a gig worker, said Dr. Alexandrea Ravenelle, Professor of Sociology (UNC Chapel Hill), at an Oct 2 Ethnic Media Services briefing about the pandemic’s devastating impact on the gig economy.

Not only do gig workers find business drying up, but those who depend on app-based livelihoods risk exposure to the coronavirus.

Uber and Lyft drivers taking strangers to airports and Task Rabbit workers going into private homes to assist or run errands, are especially vulnerable, because they often work jobs “in close proximity with strangers that carries a high risk of exposure to COVID19,” warned Dr. Ravenelle, who interviewed 200 gig workers for a study. The danger of infection coupled with a huge drop in demand for their services, puts gig workers in a “lose lose situation.”

Challenges facing gig workers

Already enduring precarious circumstances, gig workers are now forced to compete for a smaller share of offerings. Even though the lockdown triggered increasing demand for food delivery apps – DoorDash, UberEats, GrubHub – and grocery shopping apps like Shipt and Instacart, which app-based workers have long relied on as dependable sources of income, the rise in demand hasn’t helped.

In fact, app-based workers now are fighting off growing competition from a surge of newly unemployed workers for food delivery jobs, even as they fight to keep the virus at bay. In Chicago, Saori Okawa, who worked as an Uber driver before the pandemic, told the Chicago Tribune she was making less money delivering food now than she did ferrying passengers in her car.

Growing numbers of unemployed workers are using what Dr. Ravenelle, calls the ‘side hustle safety net’ to keep afloat in a sinking economy. New ‘hustlers’ are flooding the gig economy, either because they do not know they are eligible to receive unemployment benefits, or, can no longer wait for funds; but many refuse to apply for what they perceive as the stigma of a government handout. Even documented and green card holders who are eligible have refused unemployment benefits, fearing it would jeopardize their legal status.

Newcomers are turning to gig jobs as “an occupation of last resort,” even though it pays less than unemployment benefits, said Dr. Ravenelle. Many want to escape being trapped at home without any work, but most unemployed workers are desperate to feed their families and pay their rent.

She revealed that this non-traditional workforce as a whole is slightly more educated than the overall workforce; the survey indicated that 36% of respondents had undergraduate degrees, while some even held PhDs and medical degrees.

Nevertheless, none of these workers will find allies in the multibillion dollar companies that hire them, especially in California (and San Francisco in particular), which has a higher concentration of workers, because that’s where many online platform companies got their start.

Prop 22 Hurts Gig Workers

In California, gig companies are trying to sidestep legislation (AB5) that reclassified gig workers as employees, to avoid paying benefits or guarantee a minimum wage to workers. App-based giants Uber, Lyft, Instacart and DoorDash spent almost $188 million to support Prop 22  – a ballot measure to reclassify app-based (rideshare) and delivery drivers as independent contractors instead of employees, and exempt themselves from compensating workers fairly. Prop 22 would deny drivers basic safety net protections like paid sick leave, workers compensation or unemployment benefits, that are crucial during this pandemic. It removes time-based wage protections, so drivers are only guaranteed $5 an hour. As 1099-based independent contractors, workers are not entitled to minimum wage, overtime, or unemployment insurance.  Nor would there be protections for health and safety, family or workers’ compensation.

Dr.Veena Dubal, UC Hastings School of Law

“Drivers in California are owed billions in dollars from back wages, said Dr. Veena Dubal, from UC Hastings  School of Law, calling Prop 22 “the most dangerous labor law that I’ve seen in in my lifetime.”

“We need the benefits. We don’t want to depend on public assistance when we’re working for multi-billion dollar corporations,” said Robert Moreno, one of over 57 million US gig workers (according to the Bureau of Labor Statistics), who makes a living as an Uber driver.  “The almost $200 million that Uber and Lyft spent on the campaign could have covered almost three years of benefits.”

Robert Moreno, gig worker & panellist

After the pandemic Moreno saw his wages drop nearly in half from $850 to around $350 for a weekend shift, as the ride-share giant began to shortchange drivers with fee schedules and penalties. Moreno alleged his fee share dropped from 50% to 25% of the fare even as Uber charged passengers more than the fare shown on the driver’s app. Drivers are only compensated for ride time but not for awaiting a fare, so, if the ride time is just 5 minutes, asked Moreno, “What’s the profit in that?”  Uber also penalized drivers who refused low rated passengers or end-of-shift pickups, by giving them inferior assignments.

“There is no flexibility. They own you,” said Moreno.

Layoffs, cost-cutting, decrease in demand and safety concerns are forcing gig workers to quit, even as the coronavirus threatens the economy, their lives and livelihood.

Will gig workers survive the pandemic?

In March, Airbnb reported that in the last 12 years, women’s percentage of five-star reviews had grown to 83 percent, but by July, Brian Chesky, Airbnb’s chief executive, told 1,900 employees – a quarter of Airbnb’s work force – they were out.

My daughter’s Airbnb host has renewed her lease for another 6 months.

The odds aren’t in your favor when gigs dry up in a gig economy.


Meera Kymal is a contributing editor at India Currents

Image by InstagramFOTOGRAFIN from Pixabay

 

Does Prop 22 Do Justice for the Gig Workers?

Forum – A column where you get eyes on both sides of a hot button issue.

Does Prop 22 Do Justice to the Gig Economy? No!

In 1959, despite graduating at top of her law class at Columbia, Ruth Bader Ginsberg had a hard time finding jobs because she was a mother. She, later on, went on to work on gender equality laws over the next decades. As a result, today any reference to an employee’s sex in the workplace decisions irrespective of their capabilities will land employers in a world of legal trouble. At its core AB5 is about economic inequality in the workplace. 

Just like gender equality laws from the 70s, AB5 can appear burdensome to employers. On the other hand, Proposition 22 at its core is about Uber, Lyft, Doordash, and other gig economy companies trying to get away with an awful business model of counting their employees as a variable cost. The ads for Prop 22 mischaracterize the drivers as only part-time workers who already have a full-time job.

Based on my personal experience on multiple Uber rides this is completely untrue. These Drivers depend on UBER for a substantial if not all of their income. And based on my conversations with them they barely earn a minimum wage and have no allowance for the depreciation of their cars. Never mind health coverage.  Uber makes it a policy to lobby and pressure lawmakers in every city to support their flawed business model.

Despite this, their stock is down 20% from IPO in May 2019 and have a 1.6B loss against revenue of just 2.6B. I imagine other rideshare companies are probably in similar shape.  Further with self-driving cars fast approaching its only a matter of time before Uber goes driverless making this move a short-term gimmick to support their flagging stock price.  A favorite argument of conservatives is why have worker regulations at all why not let everyone work for “themselves”. This is euphemistically called the right to work in many states especially the southern states.  In 2008, a detailed study of the RTW states was done by the National Education Council and the findings of the study are very damning. The RTW states have: a higher poverty rate of 14.4% versus the 12% in others, lower per capita income of 38K versus 44K, and a higher rate of uninsured people. The uninsured rate differential is probably even higher today because many of these very states rejected Obamacare Medicaid expansion.  Sustainable economic activity is created as a result of entrepreneurship coupled with good regulation. The choice should not be between no job and a bad job.  

Having said that AB5 is far from perfect. The issue with Prop 22 is that it is a proposition.  We have bi-annual elections and representative democracy – the proposition process just circumvents the legislative process.  So I recommend a no vote on 22.

Mani Subramani is a veteran of the semiconductor equipment industry. He enjoys following politics and economics.

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Does Prop 22 Do Justice to the Gig Economy? Yes!

In these times of rampant unemployment, gig jobs at Uber, Lyft, Doordash, etc. are providing a lifeline to over a million Californians. Prop 22 will eliminate these jobs as the businesses cannot afford to treat these workers as employees and pay for benefits. Prop 22 preserves the right of these drivers to be independent contractors, something that is supported 4:1 by these drivers. The CA Chamber of Commerce and Silicon Valley Group are among others urging a Yes vote on Prop 22. Gig employment offers flexibility and freedom for workers to set their own hours and also work part-time.

Gig employment is going to be the main employment engine of the future. Governor Newsom should immediately campaign for a Yes vote on Prop 22 and ensure its passage. The livelihood of more than a million Californians depends on it. 

Please vote YES on Prop 22.

Rameysh Ramdas is a resident of the SF Bay Area and has a keen interest in Politics and Current Events. 


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