The so-called “Gig Economy” (an economy of temporary, flexible jobs) is always in the news. Companies like Uber have been touted for the convenience they offer drivers and consumers. However, for employees of companies like DoorDash, as I am, the mythology surrounding pay and benefits is insulting.
The bait for workers is simple: make your own schedule and earn money when and where you want. The system itself, however, leaves a lot to be desired. Employees complain of inconsistency and psychological degradation through a lack of a support structure and a rating system that can feel like harsh judgments of individual character.
Together, these issues compound to create an employment model that is physically and mentally grueling for workers. To make matters worse, the model these companies follow looks eerily similar to that of a pyramid scheme, an old scam that asks of participants to recruit 2-3 more people to buy into the system that thrives off the exploitation of money-hungry workers.
The gig economy isn’t the future. It’s the past nightmares of amoral capitalism revisited. Workers and consumers alike need to see it for what it is: exploitation of job-hungry workers.
To provide some context for how the gig economy works, I’m going to break into the model I’m most familiar with: DoorDash.
DoorDash is a food delivery company. The DoorDash app connects customers with hundreds of partnered restaurants for delivery.
The customer side of it is relatively straightforward, but the employment contracts DoorDash offers are where it starts to get muddy.
Like Uber, DoorDash doesn’t hire employees. Instead, they hire “independent contractors”. This practice allows them to avoid paying an hourly rate and allows drivers to choose their hours. Theoretically, DoorDash offers drivers a convenient way to increase their disposable income when they have the time to work.
Employees choose where they work and what hours they take. They’re sent orders based on their location, and they may accept or decline as many as they choose. In tandem, these facts create a perpetual need to hire new drivers to fill the space where others are not picking up orders. The temporary nature of employment is where the idea of the “Gig Economy” comes from.
Too Good to be True
What the model means for drivers is that they aren’t guaranteed employment benefits, and most importantly, aren’t guaranteed to make minimum wage.
I work in an area with decent payout, but there are areas where employees can make less than $5 an hour, a rate far below the minimum wage without even factoring in the costs of gas. Drivers that get put in a hole end up eating all of the costs themselves. When orders aren’t paying out, many turn towards DoorDash’s referral program: a tantalizing feature that has, at times, offered $1500 per recruited driver.
This is where the model barely disguises its similarities with pyramid schemes. DoorDash, like all companies in the gig economy, is desperately trying to increase market share to make profit. To do this, they have to be in a state of perpetual hiring. The more drivers that get added to the platform, however, the fewer orders there are for all the others, and the lower the payout is. Soon, “Dashers” begin pulling in others just to make out with some cash. Low pay on individual orders followed by payouts for recruitment are an all-too-familiar aspect of pyramid schemes.
Even more alarming is the fact that DoorDash is attempting to corner the delivery business, an industry that is run on thin margins. Those thin margins mean that companies like DoorDash are fighting over slivers of market share, a reality that will increasingly necessitate lower pay to produce greater value.
All told, as the industry grows, drivers will get less and less benefits.
Your Worth is Quantifiable
Beyond just economics, there are psychological factors to consider.
Like Uber, DoorDash drivers are rated on a scale of 1-5. Unbeknownst to most outside driver circles, those ratings are life or death. For Uber, drivers risk deactivation for dipping below 4.6. For DoorDash, that rate can’t go below 4.2.
There are plenty of factors beyond a driver’s control, however. Plenty of customers simply don’t understand how the rating system works, and may leave bad marks with good intentions. Still others may be apathetic towards a driver’s plight and leave bad ratings based on the mood they’re in.
All of this creates a weight around rating that leaves drivers in a mad scramble to not get left behind. Beyond that, I can attest to the fact that watching your rating dip below 5.0 spirals into feverish self-doubt that leaves you wondering what personal quality you need to amend to be worthy of that higher rating.
Even worse, these apps are manipulative towards their drivers, cajoling them into continuing work and taking orders when they don’t want to.
This is all without even mentioning the lawsuits regarding sexual harassment of and by Uber drivers.
Don’t Do This to Us
The very model of the gig economy is meant to get around regulations that have protected workers’ rights for decades. By hiring “independent contractors”, companies need not pay out a minimum wage nor provide any of the traditional benefits of a job. The gig economy can be an easy way to make extra cash for those who already have the mans, but what about those who can’t afford car insurance, health insurance, or the payments that might come when something goes wrong on the job?
If consumers care about workers, they need to boycott these companies until more actionable and tangible worker regulations come about to mitigate the apathy towards workers. Lawmakers need to ensure that longstanding workplace regulations be transferred to the gig economy’s model, especially as companies gear up to replace traditional employment structures with this model.
Without altering the current trajectory, the gig economy intentionally undoes a hundred years of efforts to protect workers from exploitative practices. Don’t champion the demise of humane employment.