Zen99, Sherpa, and Building Social Justice for the Gig Economy

The topic of the ‘gig economy’ and worker status is already a big talking point of the presidential campaign, centered on the classification of workers as 1099 contractors at companies like Uber and Postmates . Being a contractor makes workers ineligible for the benefits of full time employees, but is also a much lower cost structure for companies that, in some cases, is essential to make the model possible. (For example, Homejoy recently cited pending employee lawsuits about classification as a contributor to their failure.)

At its core, the issue of worker’s classification boils down to an issue of social justice. It would be unfair to have an underclass stuck in indentured servitude, making a break-even living in a gig job after recurring expenses (like car payments, health insurance, and gas) and with no path of advancement toward a better future. One could imagine a future where millions of workers are stuck in this endless economic limbo of break-even employment, outside the normal protections of full time employees, and the group growing over time as more low-skill jobs are automated away. 

There are some tools emerging to help empower workers. Zen99 and Sherpa are helping gig workers understand and reduce the complexity of income tracking and expenses to better understanding their ‘full picture’ profit. This is very important for gig workers as the responsibility is completely on the worker to understand how much they are really making from their gigs and how to figure out their taxes. Having better tracking and transparency will help workers to make more informed decisions about their options. 

But there are still two big problems missing a good solution: the inability for workers to efficiently maximize their hourly pay, and the lack of a career path for gig workers.

In maximizing hourly pay, there’s an information asymmetry between the companies providing gigs and the workers fulfilling them. The companies that set prices have all the insight into existing demand, and this market-making is happening at the individual service level. Gig workers need a tool agnostic of the fulfillment partner, designed to maximize the hourly rate given a worker's credentials (cleaning certification, programming skills), assets (car), and preferences (willingness to travel, clean, or deliver food). Workers need their own hourly-rate-maximization algorithms to go toe-to-toe with company hourly-rate-minimization algorithms in order to properly align employment incentives in the ecosystem. This would help the fungibility of gig employment cut both ways: while contractors would be less costly, they would also be empowered to be ruthlessly mercenary in maximizing their wages. This is only possible if information is sufficiently low friction and fast to inform decisions at on-demand speed. 

We also need a new way to think about a career path in the gig economy. Without better visibility to the tradeoffs in investing time in new skills, workers are at risk of ignoring opportunities that may better optimize their long term career outcome. A good solution would help workers take an impartial view of the right skills to develop in the short-term (eg, investing in a cleaning certification) and the long-term (eg, learning programming skills to start taking higher paying jobs from Upwork). It would also give visibility to an expected return over time, so workers could make more informed decisions about when to defer short term wages for skills with long term payoff, and make it easy by integrating with skill building resources like Udacity. Providing greater visibility into these options could help make long term upward economic mobility the norm within the gig economy.

With the right tooling we could have our ‘gig economy’ cake and eat it too. And now is a ripe time to start building, because as the presidential campaigns get up to speed these issues will quickly move to the mainstream. Companies like Uber will be under pressure to fix their model or point to solutions, and presidential candidates will be hungry to find a middle ground solution. If a tool could truly balance empowering gig workers without forcing a change to worker status, it would help build a more socially just future -- and maybe find itself at the center of a broad reaching national conversation.