As Gig Workers Face Decreased Profits, Questions Over Financial Protection Arise

According to Lindsay Cameron, an assistant professor of management at the University of Pennsylvania's Wharton School of Business, workers who have full-time jobs can feel the impact of changes to their part-time gig work

A major selling point for workers in the gig economy has been its flexibility, even after some workers have found that their take-home pay is less compared to past years.

However, it can be difficult to replicate the good parts of a gig elsewhere.

According to Business Insider, some, like Colorado resident Aaron Lavender, a former teacher, have gone back to using delivery driving as a supplement to jobs with a secure floor as opposed to utilizing gig jobs as a primary source of their income.

Although his earnings as a gig economy driver have gone down, few jobs, he said, have the perks of gig work, such as instant pay and a low barrier to entering the space, such as a driver for platforms like Uber and Lyft.

Many gig drivers, like Lavender, are part-time workers. Uber told Business Insider that 73% of its drivers work less than 30 hours a week.

However, according to Lindsay Cameron, an assistant professor of management at the University of Pennsylvania’s Wharton School of Business, even those workers who have full-time jobs can feel the impact of changes to their part-time gig work.

“Most people are financially dependent on this,” Cameron said, referring to gig driving. “Maybe it’s to pay their water bill or their child support payment, or their kid comes home from college and runs the electricity bill.”

According to NerdWallet, currently, there is one state (California) and two cities (Seattle and New York) have given gig drivers the same minimum wage protections as other workers.

A second law in New York, which was going to increase the minimum wage for delivery drivers to $17.96, was placed on hold after Doordash, Uber, and Grubhub filed lawsuits.

Gig workers have also been increasingly receptive to efforts at unionizing, in part because of a 2023 ruling by the National Labor Relations Board, which made it easier for workers like Uber and Lyft drivers, construction workers, home health aides, and strippers to unionize.

According to The Washington Post, the ruling classified workers whom employers had previously attempted to argue were independent contractors and not employees, which excluded them from entering a union.

“This case and the independent-contractor standard bears on the job quality of many workers in the United States,” Brian Chen, policy director at Data & Society, told the Post. “When workers are misclassified under the National Labor Relations Act, it deprives them of the collective bargaining that we know improves job quality, wages, and racial income and wealth gaps.”

David Hill, the Vice President of the National Writers Union, told Forbes working conditions for gig workers are often perilous despite the promise of flexibility offered by gig labor.

“I’m pessimistic that many unions are ready right now to help gig workers, either because they don’t know how to overcome the obstacles to organizing, or they are unwilling to commit the kind of resources and effort it will take to actually win against these large tech companies that employ them,” HIll said. “I think it will take a union who is willing to put up many millions of dollars, hire an army of organizers, and put together a 10-year plan to win, not to mention all the legal and strategic corporate campaigning that will need to go on in concert with organizing the rank and file.”