The term “gig economy” refers to an environment where companies and organizations contract with workers for short-term engagements. According to Bureau of Labor Statistics, it is “single project(s) or task(s) for which a worker is hired, often through a digital marketplace, to work on demand”. Virtual platforms for wireless devices can be viewed as “invisible infrastructure” in connecting individuals and firms.
Basically, anyone with smartphone can find a job or develop a business, they are known as contingent workers. Asia now home of 75 unicorn startups, accounting for 40% by value globally, leading the trend in southeast asia.Figure 1. Number and global distribution of unicorn companies in Asia. Reproduced from CB insights. Gig workers represent a growing segment in labor workforce in Asia due to the conspicuous benefits that this platform brings about. It can not be denied that the growth in digital economy platforms makes it easier to operate trading activities across the globe, enabling organisations to contract freelancers and independent workers for short-term engagements.
Gig economy also foster productivity, solving the unemployment problem and creating more opportunities for workers to earn extra wage. However, given the question of “sharing”, the way Airbnb, Upwork and Uber creates “sharing” contradicts to how we perceive this term. The economic and the emotional understanding of sharing in the capitalist sharing economy concentrate on a capital accumulation model mingling with ideology. Hence, this platform brings about not only benefits but also creates disruption in a negative way. This paper examines the negative disruption of the sharing economy within the Asian context.The paper answers two questions to substantiate the argument:Question 1: What is “gig” economy and the theoretical framework of this platform ?Question 2: Does the “gig” economy benefit worker livelihoods ?Question 3: Safety and privacy concern in “gig” economy platform.
ContentThe “gig” economy and theoretical framework of this platform.The immense description of the “sharing-economy” can be defined as peer-to-peer-based (P2P) activity of “obtaining, giving, or sharing access to goods and services, coordinated through community-based online services” (Hamari, Sjöklint, & Ukkonen, 2015). However, the model of “sharing” is a broad one. Everybody can profit from this P2P resource but nobody is directly responsible for its maintenance. An economic theory called ‘Tragedy of the Commons’ is used to represent this situation.Figure 1. The Tragedy of the Commons.
Reproduce from Jborden.comThis theory states that any sharing activity with mutual benefit will lead to the destruction of the resource (in P2P case, it is the free access to the information), unless appropriate management is designed and implemented. However, the sharing economy is now growing as a “floating signifier for a diverse range of activities” according to Sage Journals due to the massive development of technology. In Singapore, number of private hire cars increase significantly in 3 years due to the development of digital platform: Uber and Grab.Figure 2. Indicators for taxis and private-hire cars in Singapore.
Reproduced from Land Transport Authority (LTA), “Land Transport Statistics in Brief”According to Lee Kwan Yew in “Revisiting the Sharing Economy in Singapore”, the rise of ride-sharing platforms may bring more option and lucrativeness for customers but it also raises many problematic concerns for the government in terms of labor and safety issues. Consequently, more theory-based concepts and models are needed to understand and assess the impact of this phenomenon.”Gig” economy is creating challenges for labor market. Independent work involve many risks for independent contractors: legal risk and health risk. 2.1.
Legal risks due to worker misclassification”gig” worker is insecure and is offered less access to legal protections such as paid leave, sick pay or maternity leave (Dekker and Van der Veen) due to misclassificationThe worker classification of an independent contractor has always been a vague determination, and “may very well have a different meaning in each of these contexts” according to Brian A. Langille & Guy Davidov. Uber- a transportation network company argued that they are just digital platforms connecting drivers with passengers and these drivers are rather independent workers who use their software to operate their ride (Pfeffer-Gillett, 2016). According to Bernhardt, 2014; Hill, 2015; Irwin, 2016; Tomassetti, 2016, the misclassification of a worker leads to lack of the rights and protections guaranteed to standard employees such as overtime payments, federal tax forms, inaccurate work-time records and inappropriate retirement plan contributions, failure in purchasing these forms of insurance individually leads to other benefits that help secure their health, safety, and wellbeing go unpaid. Consequently, they have no social safety net to fall back on. In Uber case, the firm had over one million drivers worldwide, but only had 6,700 employees according to Lazo, 2015. This means any driver takes part in this platform are as independent contractor without any rights to sick pay or pension.Examples in Asia context: In Singapore, number of private sectors with earn high profit but hire small number of employees has increased fast which means number of contingent workers is escalate, resulting in disruption of labor’s living quality.
Figure 3. Number of private sector establishment by employee count in Singapore. Reproduced from: Labour Market Survey 2015According to Mark Graham in “Digital labour and development: impacts of global digital labour platforms and the gig economy on worker livelihoods”, the majority of buyers of work are located in high-income countries and only Malaysia and India are in this list (figure 5). However, the vast majority of work is carried out in low-income countries. India and Philippines, in particular, perform much of the work on the platform. To conclude, it increase the imbalances in the relationship between supply and demand of digital work, creating challenge for workers, especially in southeast Asia taking part in this platform.
In India, in order to protect “gig” worker, a policy is legislated that anyone contracting this service should not exceed 240 days to avoid the appearance of employment. “Additionally, to be acceptable as legal documents admissible as evidence in court, independent-contractor agreements must undergo a formal stamping process.” – according to Debbie M.
Thorne & Floyd F. Quinn in “Supplier Resources in the Sharing Economy: Three Regulatory Concerns”Figure 4.Number of buyers and workers per country. Reproduced from Supplier Resources in the Sharing Economy: Three Regulatory Concerns 2017.With the explosion of digital platform, the competitiveness among workers seaking for gig jobs increases along with sudden budget cut and increase in transactions within the sharing economy leads to reduced demand and income for workers.
Figure 5. Screenshot from a major digital labour platformTo make the matter worse, transportation network companies often constrain drivers from working for other opponent companies and set the maximum pay, providing more evidence that suggests an employer– employee relationship may exist. To date, the worker classification for these drivers remains an unresolved issue. 2.2. Health risks.
Contingent workers are exposed to physical danger, inviting strangers into vehicles, or entering their homes. According to Ravenelle in 2015, many Uber drivers in New York City have encountered dangerous, illegal or unsafe tasks or situations.Among contingent workers, health risks may be explained by differences in training and fear of job loss. Younger age is also a factor for occupational injury, especially in most of Asian countries, young workers are the vast majority of sharing economy. Figure 6.
Proportion of workers by employment status. Reproduced from RSA, good gigs, April 2017.Chronic job insecurity, known to contribute to poor overall health among contingent workers, may be as salient among gig workers. A study of a large sample of women with temporary jobs showed psychological distress and somatic complaints were higher among those who were involuntarily performing temporary jobs, compared with those workers who preferred temporary work. Another aspect of health equity is the accessible to affordable housing. However, with the development of house renting platform, the price of housing is increasing when people are renting or buying more house for short-term rent purpose, especially in Airbnb case. This system eventually widen the gaps between rich and poor.
High housing will result in housing instability, which has a significant impact on health. The “gig” economy is bring up the safety and privacy concerns. 3.1.
Safety concerns.The supply market of the “gig” economy is built on private property of participants. Because owners have the opportunity to moderate the capacity of their property on how it is used, they become independent contractors.
However, there is no rights and legal paper that cover this aspect since anyone taking part in the gig market can facilitate their own property, hence, it leads to the raise of safety concern. Most of sharing platforms now allow both customers and workers performing the service to exchange information and communicate the value of these transaction for further benefits. In this way, these systems may act as a safety net for users. However, when it comes to certain issues, these systems will show some bias limitations such as determining whether a vehicle is mechanically in good quality or not, hosts are subject to criminal background.Examples in Asia context: Seoul has claimed Uber illegal for offering unlicensed taxi services since Uber drivers are not required to have a taxi licenses to enter the market which eventually reduces the value of licenses. According to themalaysianonline.com, there were many robbery, and sexual harassment cases with Uber that it took Uber a long time to be legal in Malaysia. In 2016, alleged rape of an Indian woman by an Uber driver in India is an extreme example of the danger of P2P sharing.
Minister of Singapore National Development reported that in 2016, URA received complaints from home-owners about violations increased by 60 percent. To prevent such issues, many countries banned some sharing platform, Uber, for example, is banned or suspended in South Korea, Indian capital, Delhi. Short-term home renting like Airbnb is currently illegal in Singapore. Many laws and policies have been made to regulate the e-hailing service in this country in order to guarantee the safety of users and customers. Digital drivers in Malaysia are required to go through same requirements imposed on conventional taxi drivers such as health checks, vehicle inspection and security cards of the Land Public Transport Commission (SPAD) acquirement which is the same for drivers in Singapore.
In Philippine, mobile taxi hailing apps, such as Easy Taxi or GrabTaxi are permitted because they partner with taxi companies, while Uber is under threat of being illegal for providing public transport service without insurance for better safety. However, with the increase in the number of platform and the inability to control the drivers under this systems, nothing is guaranteed. 3.2. Privacy concerns. According to Debbie M.
Thorne & Floyd F. Quinn 2017, sharing economy model builds entirely on “the collection of small data directly from independent suppliers and consumers”. Generally, “small data illuminates what and where a need exists in real time” (Kavis, 2015).
Hence, the sharing economy is set up on a massive amount of individual specific information such as financial records, address, email, phone number, even spatial and temporal data. Figure 7. Summary of the data exchange for consumer and provider. Reproduced from reseachgate.com For this reason, the on-demand economy establishes privacy and security problems which results in difficult managing across different legal and regulatory requirements.
In extreme instances, “access to such information can result in physical harm as in the cases of stalking, exploitation, or domestic abuse” (L. Liu, 2007). Figure 8. Privacy concerns among users. Reproduced from bi.eduExamples in Asia context: Asia is a part of the world where private data protection is not being concentrated even though there are many policies and laws related to cybercrime and privacy. Hence, any piece of personal data can be exploited and used for different purposes such as data selling, marketing, and so forth.