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The on-demand economy is an even greater threat than zero hours contracts

stampout casual contractsMuch of the debate about the fast-growing on-demand economy has centred around Uber. Their drivers get paid only when they work and are responsible for their own pensions and health care. Risks borne by companies are being pushed back on to individuals, and this has huge implications for the organisation of work, the potential insecurity for workers, and the nature of the social contract in a capitalist society. Like many innovations, the on-demand economy began in the US, but the concept of connecting people with freelances is growing prodigiously. Uber, founded in San Francisco in 2009, now operates in 53 countries, had sales last year exceeding $1bn, and now has a valuation of $40bn. Altogether some 53 million US workers, a quarter of the labour force, already work as freelances.

Like zero hours contracts the on-demand economy has already spread far beyond core manual functions. In the US Uber provides drivers, Handy offers cleaners, SpoonRocket delivers restaurant meals (not just pizzas) to your home, and Instacart will keep your fridge stocked (as Ocado is starting to do). But it goes a lot wider than that. Medicast will supply a doctor, Axiom will provide a lawyer, and Eden McCallum will offer a consultant. Some agencies are now delivering multiple freelancing, such as and others which link up 9.3 million workers for hire with 3.7 million companies.

This systematic casualisation of labour has obvious downsides. Many of those who have previously felt relatively secure – not just lawyers, doctors or taxi drivers – will fell justifiably threatened. Many European tax systems treat freelances as second-class citizens, and American states have different and discriminatory rules for ‘contract workers’. Above all, at a time when a persisting sense of insecurity has become a potent political issue in Western societies, the on-demand economy will significantly impose more risk for workers. People will be under pressure to master multiple skills and to keep those skills up to date.

These profound changes in the technology of work imply a further shift in power towards employers, not the industrial magnates of the past but still those with the technological potential to make workers subservient to a very uncertain future. This is another very important area where Labour needs to be, not timid, but clear and robust in ensuring that advances in technology should be secured for the benefit of workers, not at their expense, through the safeguarding of employment rights in a wholly new environment.

One Comment

  1. Robert says:

    It is wrong, but we had it here in the Uk for a lot longer it’s self employed while working for a company. I use to wire up houses for electric , I’d take on house by house, if a house was not ready I’d sit and wait, unpaid you could not go and do another task or job because that was part of the contract you had to be on site, so you hoped the next house would be ready.

    It’s why I moved into Industrial electrics working on Oil platforms some of the contracts I had were worth half a million pounds, so I could afford to wait a week or two.

    It’s what we do to make a living.

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