In in the gig economy and on zero-hour contracts

 

 

 

In Conclusion, the gig economy does present a double-edged
sword as it offers flexibility to some individuals, however the extent to which
the gig economy and zero-hour contracts are beneficial depends on the
individual and their distinct lifestyles and situations. For some people such
as students the idea of choosing when and how many hours they would like to
work fits in with their circumstances perfectly, however for others who require
more stable employment and have dependants the insecure flexible employment
places them in vulnerable situations. Although many would argue that people have
the choice to enter such labour markets in reality the way in which the economy
and society has developed over the last 20 years and the rise of “precarious
employment” means power lies in the hands of large corporations and not
individuals. Capitalist societies and neoliberalism principles have led to
businesses focusing on competitive advantage and increase in shareholder wealth
but at the cost of employees. Many workers in the gig economy and on zero-hour
contracts are in such positions not through choice but because of economic and
societal pressures that has made them become dependent on precarious forms of
work. Therefore, large corporations and the government largely benefit from the
gig economy and zero-hour contracts and for those working within such labour
markets the benefits are questionable.

According to Karl Marx, the capitalist society we reside in
at the institutional level the interests of the government and corporations
“collude” because their shared goal is “profit maximisation” (Blewitt, 2017). The
“shareholder primacy theory” argues that businesses want to reduce labour costs
so that they can increase revenue and profits and maximise shareholder return
regardless of the impact this has on other stakeholders such as employees
(Stout, 2002). The gig economy helps to achieve this through the
“commodification” of labour where businesses have the control to use zero-hour
contracts and gig economy policies which are determined by the government to
their advantage e.g. by outsourcing and only paying for hours worked with no
worker rights (Blewitt,2017). Such labour market policies allow for the
capitalist society to function and takes away any form of control, choice and
flexibility from employees. Uber using psychological techniques such as
“ratings and non-cash rewards” motivates drivers to work “harder and longer”
but only Uber benefits from this through increased financial returns (Scheiber,
2017). However, it can also be argued that the rise in self-employment through
the gig economy may one day “overtake the public sector” as gig economy workers
can become a “powerful economic and political force” (Lynn,2016). The extent to
which this is possible will depend on whether jobs within the gig economy and
zero-hour contracts truly provide flexibility and choice to workers or if it’s
just portrayed in such a way for capitalism to continue to grow (Blewitt,2017).

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Neoliberalism ideology and globalisation also led to “deregulation
and privatisation of markets” where the “economy shifted from
manufacturing-based to information-based” (Kalleberg, 2009, pp. 3), this also
meant that power was now in the hands of employers and not workers and there
was a dramatic shift towards precarious employment. Kalleberg (2009) defines
precarious work as “employment that is unpredictable, uncertain and risky”
(pp.2). Precarious work tends to involve contingent labour or low skilled
manual work and is “gift wrapped” around the gig economy as majority of those
working in the gig economy have come from industries that required manual
skills such as the automotive industry and coal mines, which due to
de-industrialisation have now been relocated from western countries to low wage
countries in Asia (Kalleberg, 2009). This leaves many people in situations
where they have no other viable options but to accept low skilled jobs within
the gig economy that are usually on a zero-hour contract basis as they do not
have the skills for many permanent service level jobs, and therefore become dependent
on the gig economy for work. Many Uber drivers are an example of this as they
tend to be “ethnic minority men who are the sole earners and have only ever
participated in manual labour” (Field and Forsey, 2017). The lack of
opportunities for full time permanent jobs for these drivers and the
availability of gig economy work that UBER, Hermes and Deliveroo provide is the
only way forward for them. The issues of choice and flexibility within the gig
economy and zero-hour contracts therefore raises the question as to who really
benefits from such labour market strategies?  

 

 Those on zero-hour contracts who have
dependants sometimes face having to work even when they are sick or have any
sort of personal events because they always have that uncertainty of when they
will receive more hours to work (Parkinson,2017).

Students are
victims of this because they may not be able to always fit in the requests of
the company with their studies especially during the exam period but still have
fees and other costs to maintain so have no choice but to take on the work.
Furthermore, as workers in the gig economy are classified as “self-employed”
they have no worker rights such as “holiday pay, sickness pay, right to receive
the national minimum wage or any protection against unfair dismissal” (Wilson,
2017).

Workers in the
gig economy to some extent can choose when to work, for example with Uber they
can logoff the app so are not receiving ride requests, but also have the option
to work for more than one company at a time by “offering their services to several
work on-demand apps” such as Uber and Deliveroo which implies an element of
“choice and flexibility” (Healy et al, 2017). However, it can be argued that
the way in which these jobs are designed by large corporations means that
“psychological manipulation is used to coordinate workers” (Healy et al, 2017,
pp.233). For Uber this requires drivers to be flexible when demand is high
which may be early mornings, evenings or weekends and therefore the element of
flexibility on the individual is taken away (Parkinson, 2017).

 

 

 

For individuals
who have greater responsibilities such as family dependants or where they are
the sole earner the flexibility and perceived choice with zero-hour and gig
economy work places them in a vulnerable position. The rise of “neo-liberalism”
and de-industrialisation in the 1980’s led to the development of the gig
economy (Blewitt,2017) where work and wages are now less stable, and benefits
of working have been reduced (Healy, Nicholson and Pekarek,2017). Therefore,
for people with families who need the security of having permanent work and
receiving fixed wages, working in the gig economy and the flexibility is
becoming increasingly risky for them. In the case of Uber the “over-supply” of
drivers means that “in order to make ends meet and gain more rides workers have
to spend hours driving the streets while awaiting orders” (Field and
Forsey,2017) this has a negative impact on their work-life balance and due to
the insecurity of their job which is based around “easy to hire and easy to
fire” they have to accept the work they do get or face repercussions such as
not being “given any work or receiving a fine” (Behr,2017).This therefore leads
us to question the idea that workers in the gig economy have flexibility and
power to choose their working hours or if in reality they have no choice.

Personal context plays an important factor in whether the
gig economy is beneficial and provides flexibility to workers or not. It can be
argued that millennials are the “beneficiaries and victims” of the gig economy
and zero hour contracts because it offers them the flexibility to work around
their studies and choose when and how many hours they would like to work
(Parkinson, 2017).Uber in their research found that people choose to work with
the company so that they have more control and around “11% of drivers in the US
are students”, with this number rising every year (Uber Newsroom, 2015). This
is because some students do not have many dependants or major financial
responsibilities and therefore the gig economy works to their advantage. Similarly,
for individuals who have been working up until the age of 50 and above zero-hour
contracts and work in the gig economy can be beneficial for them as it can offer
a “flexible transition from full-time work to retirement” (Monaghan,2017). However,
the flexibility and value of the gig economy and zero-hour contracts does not
apply equally to everyone in society.

The gig economy is a “labour market that is characterised by
short-term contracts and freelance work, rather than permanent jobs” (Wilson,
2017). Work in the gig economy includes “crowd work” which is work that is
completed via the internet and, “work on-demand via apps” where apps manage
traditional jobs such as “transport, cleaning and admin work” (De Stefano,
2015, pp.2). Whereas in zero-hour contracts the employer “is not obliged to
provide any minimum working hours and the worker is not obliged to accept any
working hours” (Acas,2017). The changing context of work means that
contemporary organisations are based on “neo-liberal global economic thinking”
(Wilkinson et al 2017, pp.9), where due to an increase in external competition
organisations have adopted changes such as “downsizing, delayering” and
becoming more flexible (Nolan, 2011). Contemporary human resource literature
has focused on the impact of the gig economy and zero-hour contracts on society
and organisations. This essay will draw upon the literature to critically
analyse that the gig economy presents a “double edged sword” and offers
flexibility. However, flexibility and the extent to which it is valuable means
different things for people in the gig economy depending on their individual
circumstances. I will also question the notion of flexibility for workers and
who really benefits from such labour market incentives.

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