‘On-demand economy’ – the catch 22 of employment?

by Chloe Taylor27 May 2015
Last week, Requests for Startups released results from a survey of 897 people who have worked for 78 companies that fall into the “on-demand economy” sector.

These organisations include the likes of Uber and AirBnb – in short, they are the platforms that match independent workers with individual clients.

According to The Washington Post, the biggest issue facing these workers is an inability to make enough money; almost half of the survey’s respondents had to drop their job because it didn’t generate enough income.

This was mostly because there was not enough work being offered to them – 49.2% of respondents said a lack of hours was their biggest “pain point”.

But this was not the only problem plaguing the on-demand employees. Other complaints included trouble managing finances and gaining insurance for health, cars and other properties. Many of those questioned said that they simply did not enjoy the work.

The Organisation for Economic Co-operation and Development (OECD) recently released a report in inequality, which also suggested that not making a sufficient income is a recurring feature in irregular work agreements.

The Post reported that the OECD gathered statistics from 29 developed countries to assess how various forms of ‘non-standard’ employment were affecting rising income disparity.

The OECD’s results showed that ‘non-standard’ work has grown much faster than traditional employment following the 2008 economic crash. Although the likelihood is that this has kept more people in the labour force, starting out by earning less can impact a worker’s long-term earning potential. This is leading to rising pay inequality.

In spite of its findings, the OECD said that it is not necessarily a good idea to eliminate these types of employment. This is because the services’ offerings allow people to work flexibly and on their own terms, which is beneficial for obvious reasons.

The Post reported that the organisation suggested that governments look to help non-traditional workers increase their earning potential by ensuring that temporary work is compensated at the same rate as permanent work for the same tasks. It was also suggested that governments should restructure safety nets to cater for people who may not receive benefits like health insurance from a steady employer.

The OECD report outlined a trade that will increase opportunities for people to access regular jobs if they wish to. It was suggested that countries with the strongest protections for workers in traditional jobs tend to have the highest numbers of non-standard work. This implies that making work great for some can have consequences for the rest. 

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