Posted: August 14th, 2022

Platform Economy and Workers

Platform Economy and Workers: A Critical Analysis
Platform Economy and Workers: Explore how gig work and delivery apps impact income inequality and worker stability, considering recent labor rights developments
The platform economy, also known as the gig economy, is a term that describes the use of digital platforms to connect workers with customers or clients who need their services. Examples of such platforms include Uber, Airbnb, DoorDash, and TaskRabbit. These platforms offer workers flexibility, autonomy, and access to a variety of income opportunities. However, they also pose significant challenges for workers’ rights, stability, and well-being. In this blog post, I will explore how the platform economy impacts income inequality and worker stability, considering recent labor rights developments in different countries.

Income Inequality in the Platform Economy

One of the main issues that the platform economy raises is the distribution of income and wealth among workers and platform owners. According to a report by the International Labour Organization (ILO), the platform economy is characterized by a high degree of concentration and asymmetry of power, where a few large platforms dominate the market and capture most of the value created by workers . The report estimates that the global gross revenues of online web-based platforms in 2018 were $52 billion, while the total income of workers on these platforms was only $6.4 billion . This means that workers received only 12% of the value they generated, while platform owners took 88%.

Moreover, the platform economy creates a segmented labor market, where workers are divided into different categories based on their skills, location, and access to resources. For instance, some workers can benefit from high-skilled and high-paid tasks, such as software development or graphic design, while others are relegated to low-skilled and low-paid tasks, such as food delivery or cleaning . Additionally, some workers can enjoy the advantages of working remotely and choosing their own schedule, while others have to face the risks and costs of working on-site and under tight deadlines . These differences result in significant income gaps among platform workers, as well as between platform workers and traditional employees.

Worker Stability in the Platform Economy

Another issue that the platform economy entails is the lack of stability and security for workers. Most platform workers are classified as independent contractors or self-employed, rather than employees. This means that they do not have access to the same rights and benefits that regular employees enjoy, such as minimum wage, social security, health insurance, paid leave, collective bargaining, and legal protection . Furthermore, platform workers are subject to the uncertainty and volatility of demand and supply, which affect their income and workload. They also have to deal with the algorithmic management and rating systems of platforms, which can affect their reputation and access to work opportunities .

In recent years, some platform workers have organized and mobilized to demand better working conditions and recognition of their rights. For example, in 2020, Uber drivers in the UK won a landmark case at the Supreme Court, which ruled that they were entitled to be treated as workers rather than self-employed . Similarly, in 2021, food delivery riders in Spain achieved a legal victory when the government passed a law that recognized them as employees of platforms rather than independent contractors . These cases show that platform workers can challenge the existing legal frameworks and business models that exploit them and undermine their stability.

Conclusion

The platform economy is a complex and dynamic phenomenon that has both positive and negative effects on workers. On one hand, it offers workers flexibility, autonomy, and diversity of income sources. On the other hand, it creates income inequality, instability, and insecurity for workers. Therefore, it is important to develop policies and regulations that balance the interests of workers and platform owners, as well as promote fair and decent work for all.

Works Cited

: Berg J., Furrer M., Harmon E., Rani U., Silberman M.S. (2018). Digital labour platforms
and the future of work: Towards decent work in the online world. International Labour Office – Geneva: ILO.

: Codagnone C., Abadie F., Biagi F. (2016). The Future of Work in the ‘Sharing Economy’. Market Efficiency
and Equitable Opportunities or Unfair Precarisation? Institute for Prospective Technological Studies,
Joint Research Centre.

: De Stefano V., Aloisi A. (2018). European legal framework for ‘digital labour platforms’. European
Parliamentary Research Service.

: Uber BV v Aslam & Ors [2021] UKSC 5.

: Spain approves law requiring food delivery companies to hire riders as employees – Reuters

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