Solidarity and the gig economy

by Peter Hall-Jones

Gig economyIt’s a credit to the tireless efforts of Professor Guy Standing that the word ‘precariat’ has made its way into most English dictionaries. In case you’re not up to speed (and who is these days?) it means: “the class of people who are poor and do not have secure jobs” (Cambridge Dictionary). Sure, there has been a bit of debate around whether this group really constitutes a separate ‘class’, but nobody disputes that the phenomenon itself is very real.

Almost 40% of young workers in the OECD are in non-standard work, such as contract or temporary work, or involuntary part-time employment (more). At global level more than 60% of workers, predominantly women, are in temporary, part-time or short-term jobs in which wages are falling (ILO 2015).  And of the top 20 global employers in 2017, five are outsourcing and ‘workforce solutions’ companies (more). Dolly Parton’s ‘Nine to Five’ just doesn’t work as an anthem anymore.

Naturally, the English language being what it is, we have a range of apolitical synonyms for the word ‘precariat’. Workers who survive by performing a series of temporary jobs, and/or juggle bits and pieces of contract work, are ‘casuals’ or ‘freelancers’ or even ‘micro-entrepreneurs’. Their stamping ground is ‘the gig economy’. It’s all very rock’n’roll. Being your own boss, meeting endless new people, wide horizons, flexible hours, maximum variety… what’s not to like? In fact, there is a lot of research to suggest that the majority of such independent workers – in the USA and Europe at least – have ‘chosen’ to work this way (eg McKinsey Global 2016).

At this point you might like to reflect for a moment upon the use of the word ‘choice’ in industrial relations. I was one of a generation who ‘chose’ to go on the dole in New Zealand in the 1980s. In reality, the employment market had collapsed around our ears. There were no jobs for us to go to. The only real choice we had was whether or not to interpret our situation in a cheerful light.

Anyway, choice or no choice, all this is about to change.

Automation, paired with a combination of AI and big data, is coming together to create an economy dominated by online platforms. Technologies such as blockchain and digital currency are forcing their way into mainstream economics in what the Davos crowd has called ‘the fourth industrial revolution’ (more). The World Economic Forum has even put dates on the tipping points for such developments (ie the dates by which they will have become mainstream). In case you’re interested, here are their predictions¹. As you read, have a think about the number of livelihoods that are on the line:

2021: Robots and automation;
2021: The Internet of things, wearable Internet;
2022: 3D printing and manufacturing;
2023: Governments and the blockchain;
2023: Supercomputers in our pockets;
2023: Implantable technologies;
2024: 3D printing and human health;
2025: 3D Printing and consumer products;
2025: AI and white-collar jobs
2026: Driverless cars;
2026: AI and decision-making;
2027: Bitcoin and the blockchain.

It doesn’t end there, of course. Soon afterwards we’ll have similar tipping points for nanotechnology, genomics and quantum computing. Then there’s the next big thing, and the next, and the next, whatever they may be. The problem is, as all this happens enormous chunks of the world’s workforce are going to become surplus to need. Put simply, we are headed for an era in which there is far greater labor supply than there is labor demand. More workers than work. Some might manage the transition by adapting this way or that, but the vast majority of us will be joining the gig economy. Here’s a prediction: for a few years many of them will cheerfully proclaim it was a choice.  🙂

The effects of this shift are already being weighed. The International Labour Organisation puts it this way: “The ongoing transformation in the employment relationship is having important economic and social repercussions… It contributes to the growing divergence between labour incomes and productivity, with the latter growing faster than wages in much of the world. This, in turn, has resulted in a shortage of aggregate demand that has stubbornly persisted throughout the years since the crisis. This report (download) estimates the loss in global demand at $3.7 trillion as a result of unemployment, lagging labour incomes and their effects on consumption, investment and government revenue.”

The way this is written insulates us from what is actually being said. We are heading (one way) for an era in which there are far more workers than there is work for them to do. And what happens when you take $3.7 trillion worth of demand out of the economy? Elsewhere, the ILO is slightly more direct: “A vicious circle may be at work, with lower demand affecting output and employment, thereby further depressing demand” (more).

Okay, Geneva bureaucode aside, what does this all mean for the average working person? Unless we can find a way to change the rules of 21st century capitalism we are majorly fucking screwed.

We??

It seems almost quaint to talk about class and solidarity and things like that in the 21st century. After all, workers have spent most of the past three decades learning how to compete for work, in much the same way that companies compete for business. A whole new industry has developed around improving job interview techniques. Curriculum Vitae have become personal branding exercises. Employment agencies serve as mass filtration systems. Sites like oDesk, Elance, Clickworker, TaskRabbit, Hello Alfred, Handy, Upwork, Freelancer.com and Amazon’s Mechanical Turk operate as international auction houses for work. This is an environment which can only offer a declining role for organizations such as unions, which have been traditionally defined as “free associations of employees”. In many countries, this industrial role is codified into law — unions cannot legally operate within the gig economy!

The results are already becoming clear, especially in wealthier nations where workplace relationships changed the fastest. Nowadays, the union movement has become a battleground not an army.² After more than thirty years of neo-liberalism, we have only just managed to turn a rout into a retreat. Now a new storm is gathering. The current transition to an online platform economy will massively undermine unionism in every respect, creating a whole new generation of membership decline and internal disputes.

Anyone who has read Paul Mason’s “Post-Capitalism” will have sensed that there is a way forward. Unfortunately (and understandably!) Mason does not talk much about unions. However, we can look to writers and activists like Janelle Orsi to join the dots. Orsi has argued for a transition from investor-owned to producer and customer-owned platforms (more). Such a shift is clearly in the social interest but, of course, that does not mean it will happen. If it does not, Orsi argues, we should do it ourselves. We should set up our own co-operative versions of these platforms (more). In the parlance of industrial unionism, labor should be preparing to enter into direct competition with capital.

Pie-in-the-sky? Absolutely not. Who built these platforms? It was not the directors or the investors. In taking up a challenge such as this, working people would also have some natural advantages. First, by far the majority of consumers are workers. By and large we are the market; both the buyer and the seller. Solidarity would be rational behaviour. Second, all profits from co-operative enterprises are returned to members, or reinvested in the enterprise on their behalf, rather than taken out of the system. This confers another business advantage. Third, the co-op’s members would also act as guarantors for a minimum hourly rate, thus attracting other workers away from the “race-to-the-bottom” that is evident in other platforms. Fourth, in many countries workers’ platforms (eg “T-corporations” in the USA) are exempt from tax. In every way, solidarity provides an advantage.

The problem is, how can we, as ordinary working people, change the rules in such a profound way? Nobody is better placed to do this than the union movement. It is already the largest democratic platform in the world. The International Trade Union Confederation (who are the strongest player at international level) represents about 200 million workers in 163 countries, with 331 of their affiliates operating nationwide. The World Federation of Trade Unions represents another 90 million workers and, among the independent national bodies, the All-China Federation of Trade Unions alone represents about 280 million workers. Then there are regional federations such as the General Confederation of Trade Unions in Eastern Europe, which has about 75 million members.

At this point anybody who knows the union movement will be having a bit of a chuckle. These groups could not work together for long enough to organize a cake stall, yet alone a cutting-edge digital platform. Furthermore, there is a huge overlap in their membership numbers, some of which were dubious to start with. And some of them have internal democratic practices that are, well, let’s just settle for the word flawed. But I would suggest we set aside that part of the discussion for a moment.

The unions’ natural partner in developing “solidarity platforms” (to coin a term) would be their oldest historical ally: the co-operative movement. Taken together, according to the International Co-operative Alliance, co-ops have about 1 billion members worldwide. Some co-ops are owned by workers, others by clients, others by consumers. Each of these groups could provide invaluable leverage and development input.

Again, there are internal problems within the co-op movement that would create serious barriers for I.T. developers. The global platform economy relies on multiplying innovation with economies of scale. It needs to be as free as possible, in order to work rapidly and change direction at a moment’s notice. The last thing developers need is the burden of having to seek deep consensus. Worse still, imagine day-to-day control by unions: delaying strategic questions until the next meeting of the steering committee; factional pressures, squaring milestones with congress resolutions and caucus decisions; having to consult with structures within structures within structures…

Almost certainly, solidarity platforms would need to be autonomous projects. However, the international union movement has more experience in this area than it may care to admit. There have always been strong characters running their own de facto fiefdoms. We just need to make the process formal and transparent.

The proposal, then, would be to set up labor-owned and controlled alternatives to global platforms such as Uber. It sounds ridiculously ambitious, doesn’t it? And yet private capital has been doing this kind of work for years. More to the point, it is us who did it for them. As discussed above, we have huge advantages we can call upon for leverage; we are far better placed than the private sector to succeed in such projects. And on top of this, we are in a position to adopt proven production and development models — ones that have already been successful elsewhere. (Who better to help with this than the ACFTU?)

As always within the union movement, the question of resources comes first. Most of the global federations and their international bodies are struggling to adapt to declining budgets. Some of the national bodies and their affiliates are relatively wealthy, but they have no remit to consider this kind of international project. Not only that, but members would be quick to point out that most platform projects fail within the first two years.

Now is hardly the time to start drawing up speculative lists of pros and cons. One way or another, unions must engage with the gig economy. It’s a safe bet to say that while we are doing so there will be an ongoing decline in social solidarity and public wealth. Inevitably, this leads us back to a series of questions we have been wrestling with for years:

  1. Why would workers who compete for work as individuals join a union?
  2. What benefits might new forms of membership confer?
  3. Without ‘traditional’ structures uniting us, can there be a collective way forward?

The New Unionism Network has no resources to speak of. The best we can do is raise questions such as these and suggest possible answers. In this case, I would like to suggest that the missing word is prototyping. Given this and a few champions (probably at national rather than international level) solidarity platforms might well answer all three of the questions above. More importantly, if we engage directly with the new economy, we might end up with a world we want, rather than the one left over after capital has done its business.

 

Additional notes

  1. See Deep Shift: Technology Tipping Points and Societal Impact, World Economic Forum Survey Report, September 2015, download  as at 29/12/17.
  2. To borrow a phrase from Karl Marx, who was writing about the church at the time.
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