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The Gig Economy And Its Future

The UK’s labour market has changed considerably in recent decades, particularly in the 10 years since the 2008 crash. Whilst we are consistently reaching record levels of employment, and many sectors of economy are experiencing significant jobs growth, Traditional full time work is now a declining feature of our still, slowly recovering economy. Low pay […]

The UK’s labour market has changed considerably in recent decades, particularly in the 10 years since the 2008 crash. Whilst we are consistently reaching record levels of employment, and many sectors of economy are experiencing significant jobs growth, Traditional full time work is now a declining feature of our still, slowly recovering economy.

Low pay and insecure conditions are now common blights on the lives of many workers, and zero hours contracts – which offers a great deal more flexibility to workers, alongside a lot more uncertainty – are now increasingly common. The changing nature of the economy, and the labour market, has been accelerated and emphasised by the growth in new technology, and the new opportunities for companies that this has brought.

This is no more true than in the so-called “gig economy”. This term is variously defined, but generally agreed to be something along the lines of “a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs”. This has meant that new companies like Uber and deliveroo have capitalised on smartphone technology to create new types of employment arrangements, whereby they have very few employees. Rather, those who carry out their business at the grassroots, day to day level are, officially, self employed.

This is a status which has sparked much controversy and debate. Self employed workers lack the basic employment rights, like sick pay and parental leave, that are guaranteed to those in traditional employment contracts. Whilst the companies involve claim that this gives their workers greater flexibility, critics argue it is designed for the purposes of exploitation, and that those who Uber and others claim are self employed, lack any of the key indicators or features of self employment.

As such, numerous high profile court cases have struck against these companies, granting gig economy workers employee status, and the rights that go along with it. And with the contested nature of this type of work, there is much debate about policy ideas that could better protect those who are currently outside of traditional employment. The sad truth is that a post-financial crisis, low wage economy, and rapid developments in consumer technology, have rendered old Government approaches to work invalid to deal with new challenges.

So the question is now posed: what can Government do to rise to the challenge of tomorrow’s labour market, to ensure that the gig economy presents new opportunities for economic recovery and common prosperity, rather than a new crisis to contend with. And this is the question being addressed by Matthew Taylor, who, on the commission of Prime Minister Theresa May, is investigating whether employment law is keeping pace with the changing world of work.

Him and his team are looking into various elements of the modern labour market, including the supposedly self employed gig economy workers of Uber, deliveroo and similar corporations, and  those who are in more traditional, but still controversial, zero-hours contracts. It is Mr Taylor and his associates who will be at the forefront of guiding the gig economy – in the UK at least – in to the future. What they will eventually recommend is, as yet, unclear, though they are considering a whole host of issues and policy proposals. What is clear is that action, in whatever form it eventually takes, is sorely needed to solve the dragging issues of a radically changing economy.

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