Can't live without it: The Gig Economy
You need to get a ride to the airport? Or are you craving pasta from that one restaurant? Perhaps you just need some help with a chore? Well, thanks to the digital gig economy you can get all that, and a lot more, done just by your phone. The gig Economy by definition refers to any temporary work. But, like everything else it is becoming more digitalized with Uber and Postmates at our disposal. Which means that your craving for Chinese food and your laziness, employees many people. Some use this as a 'side hustle', a way to earn some extra cash. But, others run around doing odd jobs, as their 'main hustle', or in other words, they are permanent members of the digital gig economy. So, if it helps you out and employs many people at the same time, then surely it couldn't be any more complicated? Not everything is looking so rosy. Let's just take a closer look. Shall we?
The Gig Economy
The gig economy. The freelancer economy. The sharing economy. It has many names, but it refers to one future. A future in which not being part of the gig economy, as a consumer or a worker, will become nearly impossible. It is estimated that by 2040, forty percent of workers will be working in the gig economy, in America alone. Working in the gig economy is a choice that many millennials are increasingly making. As they start to value "adventure and an interesting life" more than a stable job, a flexible work life becomes more desirable. Digitalization has also made a huge contribution to the decreasing full-time jobs, which leaves many people taking refuge in the gig economy. The biggest players in the gig Economy are companies like Uber and AirBnb. They have expanded their operations worldwide and have even become household names in many places. But, the gig economy online is ever expanding and ever innovating, which is why it is also lead by many startups, that have helped fill in the gaps. Some are popular like Postmates or Food Panda, others not so much. But the battle to dominate this newly fledging market has been dirty.
Uber's Adventures
In 2009, a company was born that allowed people to hire taxis through their smartphones. It didn't seem like much, that is until it became one of the most valuable startups on Earth. That startup is obviously Uber (just in case you didn't read the title). Currently Uber is seen as a cheaper way to travel around, but at the start it cost 1.5 times as much as a cab, But, it allowed you to book a ride anywhere, with just a simple tap. It soon became a hit. Uber has seen its ups, as it became a magnet for investors and funds. Its value skyrocketed and promised great returns. But, recently time for Uber has not been that good. It pulled out of Russian and Chinese market, a while back. Selling its business to rival companies, startups like Didi in China. After that Uber showed itself the door in yet another market. It left South East Asia, selling its business to Grab, a Singapore based ride sharing firm. But, don't give up hope on Uber just yet. Uber has recorded a profit for the quarter (on paper at least), and is working on its self driving cars. But marred with sexual assault claims on drivers and billions of losses, Uber will need a lot more work, on its business operations and a better image, to become the star of the sharing economy. Starting with a new PR department?
AirBnb it?
AirBnb is an year older than Uber. It started off in 2008, by two guys named Brian Chesky and Joe Gebbia. They got an air mattress, and put up a site called "air bed and breakfast". A humble start, leading to a company whose value now exceeds 30 billion dollars. There are three simple steps, listed on AirBnb's site, for you to find a unique place to stay at. Similarly, three simple steps, for you to start hosting guests. However, AirBnb's rise is not as simple, as three steps. But, let's give it a go-
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Three steps to creating a multi-billion dollar company
1) Buy an air mattress and set up a simple website for "Bed and Breakfast"
2) Get funds to start off the company. A tested idea would be to sell special edition cereal boxes. (Disclaimer: Do not rely on cereal boxes as only means of fundraising)
3) Take advantage of existing sites (such as craigslist) to promote your site, by integrating the two. (Warning: This may be illegal, so you should probably get permission before you do that)
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Ok so, selling Obama cereal boxes and taking a lift from craigslist is not the whole story of AirBnb. It is a company that faced a lot of controversy as it worked up the ranks. It needed to gain the trust of all it's users. Since allowing a stranger to stay the night and (vice versa) staying at a strangers house, is never easy. AirBnb has been under hot water for that very reason. "A customer who booked into a Melbourne house on Airbnb was allegedly murdered by three men who live there." Such headlines and a lot more have hit Airbnb more often than it would care to admit. So, while this company has expanded around the world, and has offered people a chance to stay in fairytale tree houses, AirBnb needs to keep building trust. And don't forget about profits.
Every day I’m husslin'
I mentioned before, that while the gig economy may have its champions, it is mainly driven by smaller companies.
These companies (on the left) and many more are the ones that drive innovation in the gig economy. But, many of these companies come underneath a huge hurdle, on their way to success. The status of the people that work for these companies is something that can't be agreed upon. These companies don't consider them to be employees, and therefore don't provide them with basic requirements such as healthcare or paid leave. But, many employee rights activists believe that these people should be given such amenities. After all, many of them work in the "gig economy" full-time.
Such legal challenges have put huge strains on majority of these smaller companies. Since many of them just simply cannot afford to provide such privileges to all people using these apps. Uber, AirBnb, Amazon Flex, companies like these may have an advantage over the rest when it comes to this. An unfair advantage?
Everything's fair in the gig economy?
The gig economy is here to stay. Whether you like it or not. The question is- will it be fair? Fair to the smaller companies. Fair to the people working in it. Fair to the customers. Will it be able to guarantee safety and quality to its customers? Will it infringe upon the rights of the growing number of people it employs? Will companies like Uber, which have been around for a while now, crush it's competition before it even has a chance? Could this economy give birth to the new Google? I guess we'll just have to wait and find out. In the meantime, do you want anything from Postmates?