Isn’t the ‘platform’ economy wonderful? Uber. Deliveroo. Convenience and low prices for customers. Really, what’s not to like? But what do platform workers themselves think about what they do? Digital ‘platforms’ broker work to freelancers in an online marketplace for talent. Jobs in these new, mostly service, industries offer freedom and flexible working conditions. Many workers value this as it lets them fit work around their lives, rather than vice versa.
But at what point does this flexibility outweigh the increased insecurity that is the obvious corollary of working in industries where your time and labour is highly commodified? And, for those of us still beavering away in the ‘old’ economy, does the change from a world where firms access labour through a conventional employment relationship towards self-employment herald a more profound shift to a working world without social insurance, minimum wages and worker protection?
Up to now it’s been difficult to get to grips with these questions with much precision because of a lack of reliable data. In a new working paper for the European Trade Union Institute, senior researchers Jan Drahokoupil and Agnieszka Piasna investigate working conditions in the platform economy using Belgian data about the meal delivery service Deliveroo. For a couple of years after it launched in the country in 2015, Deliveroo used another intermediary, SMart, to organise, manage and legalise workers’ employment status. By studying SMart’s data and following up with an online survey, the researchers were able to analyse how platform workers experience this way of earning a living and what they like and dislike about it.
Some of the patterns the data revealed are unsurprising. Most Deliveroo drivers are young, male and work for the platform for a relatively short period – half the drivers surveyed had been there less than seven months. A large number were students. The SMart records also indicated very short monthly working hours. On average, workers worked only 23 hours a month, with a median of 17 hours (about a tenth of what a full-time job would be in Belgium). Only a small hard-core of heavy drivers averaged a full-time working week of 35-hours.
At face value, this fits the platform economy vision of working lives organised around freedom and flexibility. One problem is that, even for those working few hours, Deliveroo still often represented their main source of income – and it is very low-paid work. Deliveroo drivers earning the most tended to be the most independent in that they lived with a partner and children, rather than being students based at home with parents, for example. Yet these relatively high earners from the platform still averaged only €720 a month of net income. Low earnings therefore imposed a set of (financial) limits on the independence of riders. Deliveroo workers often took other jobs to get by. But these also tended to be in other informal sectors with similarly low levels of pay and threadbare working conditions.
But the crux of many workers’ disenchantment with the platform, noted by the ETUI researchers, stems from differing notions of what is meant by ‘flexibility’. Workers discovered that the flexibility they wanted (more control over where and when they worked) was not the flexibility they got. This was because Deliveroo maintained tight control over shift patterns and unilaterally adjusted these in response to rising and falling demand. Drivers were often unable to book their preferred shifts when these conflicted with the requirements of the business and sometimes got disconnected entirely from the work booking system after rejecting shifts too often.
The majority accepted that Deliveroo is a business with a profit-motive and not run for their own convenience and were prepared to accept some constraints on their freedom to set their own hours in return for a modicum of income security. But what many of them got instead was very limited autonomy and little in the way of income security because of the low wages and sporadic hours. The much vaunted ‘flexibility’ of the platform was largely one-way.
The specifics of the Belgian case as evidenced by the Smart data are particularly revealing as it enabled worker’s attitudes to their situation to be studied as conditions changed. Deliveroo had initially adopted the SMart system to be able to access a student workforce and benefit from tax breaks without actually having to employ them as workers. The SMart system had offered workers a paid shift system which was popular as it offered them a degree of income security as well as some insurance protection.
Deliveroo subsequently abandoned the partnership when the tax advantages disappeared and switched to a per-delivery remuneration system. Although the company argued this gave riders more autonomy, the loss of income security was felt keenly – and negatively. This, and the failure of attempts by workers to reverse the decision, points to the continuing attractiveness (to some employers) of the extreme flexibility offered by the business models of the platform economy. But this is too often bought at the cost of greater precarity in the working lives of their employees.
- The post gives the views of its authors, not the position of LSE Business Review or the London School of Economics.
- Featured image by www.shopblocks.com, under a CC-BY-2.0 licence
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Steve Coulter is head of communications at the European Trade Union Institute and visiting fellow at LSE’s European Institute.