How about a Great Reset for freelancers?
If we are rethinking the way economies function and societies are organised, perhaps it’s time to stop treating gig-economy workers as an afterthought
"There are decades where nothing happens and there are weeks where decades happen."
Vladimir Ilyich Lenin
People often think they are living in revolutionary times where “all that is solid melts into air, all that is holy is profaned”. Occasionally, they actually are.
If the times we are now living in aren’t revolutionary, I think we can all agree they are, at the very least, unusually tumultuous and pregnant with possibility.
After four decades of free-market fundamentalism and globalisation, political, business and cultural elites have been forced into rethinking issues they’d long regarded as settled. The rise of China, destabilising levels of wealth and generational inequality, and the hammer blows of Brexit then Trump have changed the game.
Then there are the massive social and economic changes already wrought by advances in automation, data collection and analytics, and telecommunications, as well as the ones that will soon be wrought by artificial intelligence, augmented and virtual reality, blockchain, the Internet of Things, the metaverse, quantum computing and 5G/6G.
To paraphrase the most prominent Great Resetter, Klaus “You’ll own nothing and be happy” Schwab, a technological revolution – one that is blurring the lines between the physical, digital and biological spheres – is now fundamentally altering the way we live, work and relate to each other.
It’s a funny old world
If you’re still not convinced we live in interesting times, consider these once near-unimaginable developments.
God is dead and faith in most of society’s institutions has collapsed.
Americans are increasingly disinclined to “kick [geopolitical] ass” while the ethno-nationalist Han Chinese are increasingly eager to avenge their century of humiliation.
A demographic winter looms.
Plutocrats have begun demanding that more of their wealth be redistributed.
Nation-states are now requiring the Googles and Apples of the world to start paying some tax.
The Republicans in the US, the Tories in the UK and the Liberal-National coalition in Australia have become parties of the working class. Meanwhile, what were once the parties of the working class have grown ever-more obsessed with the ever-more obscure causes célèbres of the upper-middle class.
We’re presumably days away from “human sacrifice, dogs and cats living together, mass hysteria!”
The latest new class
Pandemic-related events such as the Great Resignation and the mainstreaming of remote work, along with pre-pandemic trends such as a growing focus on workers’ output (rather than the hours they clock in the office), should result in both employers and those who are presently employees becoming more open to freelance or contractor arrangements in the years to come.
Up to a third of income-earning individuals in countries such as the US are now at least dabbling in the gig economy. Many of them are committed micropreneurs who have no intention of returning to wage slavery ever again.
I’d argue the rise of the gig economy is creating a new social class. A class that now accounts for, at a rough guess, at least 10-20 per cent of the workforce in many first-world nations.
More on that shortly, but first a little background.
During what the French refer to as the three glorious decades following the end of WWII, lots more young people started going to university in Western nations. Hard as it now is to imagine, prior to WWII relatively few people went to university and university graduates tended to lean right.
Post-WWII, and especially from the 1960s onwards, universities started churning out lots of people who fell between two stools, class-wise. Many of them were raised in working-class or lower-middle-class homes, but they didn’t share the collectivist, socially conservative values of their blue-collar parents and grandparents.
Then again, they weren’t your traditional conservative voter either. They frequently worked in the public sector, weren’t big on traditional hierarchies, and had all sorts of bohemian ideas about gender roles, arts funding and environmentalism.
This isn’t the place to explore it in detail, but much of what’s occurred politically over the last half century, including the recent rise of identity politics, can be explained by the fact (a) mainstream political parties, especially left-of-centre ones, have increasingly been made up of New Class (aka Professional-Managerial Class aka symbolic analyst aka knowledge worker) types and (b) mainstream political parties have long been eager to represent the interests of New Class types, who tend to be more politically engaged and vocal than the average citizen. Parties frequently pander to New Class voters, even when it means antagonising their traditional constituencies (e.g., proletarian, patriotic, socially conservative Labour voters or patrician, patriotic, economically conservative Tories).
The two-speed gig economy
Much commentary about the gig-economy reinforces the narrative that gig-economy workers are the 21st century serfs, even worse off than their blue-collar grandparents. (Grandparents who at least had some job security, a dependable pay cheque and a realistic prospect of buying a house and raising a family on a single income.)
This grim narrative isn’t entirely wrong. But it isn’t entirely right either.
Many gig-economy workers, such as the ones who Uber you or your dinner around – have been sold a pup by Big Tech.
But plenty of gig-economy workers are doing well for themselves.
Perhaps it’s just the circles I move in, but I know, or know of, lots of contractors and freelancers – website designers, SEO experts, copywriters, PR managers, content providers, technical writers, IT-support providers, videographers, software developers, digital marketers, social media specialists, influencers, management consultants, HR advisors – who earn substantial incomes and feel more empowered being free agents than they ever did when they had corporate jobs.
The struggle is real
I don’t think anybody needs to be lying awake at night worrying about a digital nomad software developer pulling in $200,000 a year. But many gig-economy workers are struggling to make even a subsistence income. And, even in the case of well-renumerated freelancers and contractors, there are some issues that could cause significant individual and societal grief if left unaddressed.
I don’t have any elegant solutions to offer, but here are some problems I think gig-economy workers – and ambitious politicians who want their votes – should be thinking about.
The non-employees’ no-man’s-land: Gig-economy types aren’t employees, so they don’t get holiday and sick leave or access to a workers’ compensation payout if they suffer a mental or physical injury in the course of their work. In the US, freelancers and contractors may struggle to get health insurance. In Australia, they don’t have an employer directing 10 per cent of their income into a superannuation fund.
Of course, any sensible freelancer or contractor who is doing well should be directing a proportion of their income into health and income protection insurance and a retirement fund. Unfortunately, in my experience, gig-economy workers aren’t much better at planning for the future than any other cohort of fallible humans.
So, what happens when those individuals suffer a serious illness or get too old to work? Where is the money coming from to support them?
The feast-famine cycle: Most people are clearly either employed or unemployed. They either have a job and the wage and benefits that come with it, or they are unemployed and eligible to get the dole.
The boundaries between being employed and unemployed are much blurrier for those of us in the gig economy.
Few freelancers/contractors who have a quiet week think of themselves as unemployed and deserving of a handout. But what happens when you have a quiet month? Or a quiet quarter? If I make $40,000 one quarter and the taxman pockets around a third of that, am I entitled to some of that money back if I only $4000 the next quarter? If, after several years of earning a good income and paying plenty of tax, I hit a prolonged dry patch should other taxpayers support me while I attempt to land some new clients and get back on my feet? If so, how long for? Three months? Six months? A year?
The upskilling conundrum: DeFi (Decentralised finance) and Web 3.0 are hot right now. So, in a perfect world, I would down tools for a month or two and acquire a lot more knowledge about blockchain, crypto, NFTs and smart contracts than I currently possess.
Once I acquired this knowledge, I’d be able to charge venerable financial institutions and scrappy fintech start-ups top dollar to explain their offerings to the general public.
In this hypothetical upskilling scenario, everyone would win.
My income would probably increase by 50-100 per cent almost immediately. On top of the extra money I would then directly inject into the economy, the tax office would benefit to the tune of many thousands of dollars.
There would be one more DeFi/Web 3.0 writer in the labour pool, which would make it a little more affordable to hire content providers with an understanding of DeFi/Web 3.0. And one of the fintech start-ups I provide content to could end up being the next Afterpay.
In the real world, none of this will happen.
I don’t have an employer who is going to cover my tuition costs and pay me a wage while I spend a couple of months attending a DeFi bootcamp. I’ve got children to support, so I can’t down tools for a prolonged period to add some more strings to my content-provision bow. (Even though there would almost certainly be an impressive return on this investment of time.)
Along with plenty of other avaricious content providers, I will attempt to educate myself about DeFi/Web 3.0 throughout 2022. But it will be a slow process, undertaken at the end of long working days or during (hopefully rare) slow weeks. That means it will be some time until I can earn more and some time until the burgeoning number of fintech start-ups have access to plenty of DeFi-savvy writers. In the meantime, economic opportunities will go begging all around.
To put it in slightly less solipsistic terms, it’s all very well telling people they need to constantly upskill to remain viable in a fast-moving, digital economy, but exactly how and when is this upskilling meant to take place?
The government should do something
My current thinking is that governments – perhaps using some of the extra money they may soon be receiving from tech behemoths and billionaires – should aim to sandpaper away some of the rougher edges of the gig economy.
For instance, governments could make some sort of welfare payment or low-interest loan available to freelancers and contractors going through a prolonged quiet period. Likewise, they could pay freelancers, contractors and maybe even employees to acquire in-demand digital skills.
But I have no clue how even the wisest and most competent government can ensure freelancers/contractors don’t risk bankruptcy if they suffer an incapacitating illness or injury. Or ensure short-sighted freelancers and contractors don’t end up dining on dog food in their dotage.
If you’ve got any bright ideas, please volunteer them in the comments section below.
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