The Gig Economy

Alex De Ruyter, Martyn Brown

• Publisher: Agenda Publishing
• Year: 2019
• ISBN:
  9781788212717
• Topic: Economics
• Subtopic: Labour Economics
• Index: Economics

The "gig economy" is a relatively recent term coined to describe a range of working arrangements that have previously been denoted as precarious, flexible and contingent. These may include casual workers, temporary agency workers, those on zero-hours contracts and dependent contractors.

This books seeks to get behind the contemporary buzz surrounding the term and provide some theoretical and empirical analysis of the gig work phenomenon. The book seeks to assess more critically some of the rhetorical claims made about gig work and to provide a balanced appraisal of the ramifications for individuals, employers and the economy and society in general of an increasingly insecure workforce. The regulatory framework, in particular, is examined and is shown to have lagged behind crucial developments in the gig economy, with many labour laws still historically rooted to the notion that a worker has to be an employee to be covered by employment rights.

The authors show that in many respects there is nothing new about the gig economy and that its growth in recent years was in some sense predictable. Perhaps its real significance, they argue, is its potential as a business model to "gig-ize" other business operations far beyond relatively low-skilled work. When combined with automation and digitalization, the gig economy presents us with an opportunity to re-evalute our understanding of the nature of work.

1

Introduction

The purpose of this book is to explain in a concise manner to a non-specialist readership what is meant by the “gig economy”, how it operates and what implications it poses for the workers and businesses that operate within its confines, and what issues it raises for the wider economy and society. In seeking to assess this phenomenon, this book above all adopts a historical perspective.

A key posit is that the gig economy is just the latest trend catchphrase capturing a spectrum of flexible (or precarious) work arrangements that have existed in one form or another since the ascendancy of capitalism in the sixteenth century. Indeed, it could be argued that such work arrangements, aside from the post-Second World War welfare state phase in mature, western states, have constituted the dominant arrangement in capitalist societies. The gig economy then could be interpreted as “old wine in a new bottle”. However, the emergence of the gig economy has also been posited in terms of technological advancements that have led to the automation of certain functions and the coming together of information technology and telecommunications technologies.

This has led to the superseding of traditional firm structures, in the sense that the “transaction costs” identified by Ronald Coase in 1937 (Coase 1937) associated with contracting on the open market have been reduced by such technological change and hence lessened the perceived need for employment (as opposed to market) relationships by such firms. As such, there is a clear need to get behind the label of gig economy and gain an understanding of the objective conditions of work surrounding such jobs, gain an understanding of the motives and business models of companies that seek to utilize workers under such arrangements, and hence identify the factors that have driven growth of such jobs. In the next section, we begin by exploring the origins of the term “gig” and thereby seek to understand the evolution of its discourse to now being used to describe a key structural feature of modern capitalist economies.

Introduction

The word “gig” is used to denote many things, often bearing little relation to one another, still less to any “original” meaning. Yet this very diversity may give us some indication of what this phenomenon means in terms of the economy. Jack Barsky, a KGB spy operating in the US who upon being caught in 2010, recalled “I knew the gig was up” (Barsky & Coloma 2017). One of the current authors was invited to take the role of external examiner for a university in Greece, which the previous incumbent described as “a good gig”. Similarly, a senior manager, academic and government advisor from a major UK university referred to a recent trip to Romania, where he was delivering a speech to government ministers as an “interesting gig”. The word “gig” is versatile to say the least. The gig economy also seems to have reached the status of stock phrase and rarely does a day pass when the media fails to run a story on it, so that it has now become as integral to our lives as Brexit.

Given the import and currency of the gig economy there is surprisingly little written on the subject by academics. Yet there is a clear need for published work to document, conceptualize and contextualize these developments to facilitate a move beyond the narrow focus on “employment” to embrace a wider critical debate on the utility and meaning of “work”. Perhaps the lack of interest in the phenomenon is symptomatic of the “taken for granted” nature of the phrase and the word. But the word “gig”, it will be argued, is in many ways well suited to describe the phenomenon. This chapter does not seek definitions in the time-honoured way, but the inexact connotations and nuanced meanings will help us understand why the word “gig” has been allied more recently to the word “economy” and to what effect.

The nature of gig work

One of the earliest uses of the word “gig” was in the medieval period where a gig referred to something that spins around. Indeed, the rotary washing line, a relatively recent invention, is sometimes colloquially referred to as a “whirligig”.¹ The only stable pattern the whirligig has is its rotatory motion, but the direction, speed and frequency of rotation is unpredictable, sporadic and temporary, subject to the vicissitudes of the wind. These days however, a gig is most commonly associated with the entertainments industry, and it is to this world we turn for our most helpful insights into the gig economy.

In the entertainments industry, a gig is a public performance, often a one-off event yet sometimes repeated or even regular, usually paid, but maybe not. The gig might be the result of careful marketing or simply fortuitous, but is more likely to be unpredictable and precarious.

A key feature of the life of a working musician is the notion of the “dep”; an abbreviation of the word “deputy” or “deputization”. Unlike gig work in the context of the gig economy, a dep in the music business is someone often very skilled at reading music and/or extremely versatile in terms of performance styles and who is hired to stand in for another musician, whose gig it was, because the latter cannot make it for some reason. The dep can be seen as similar to the notion of the freelancer (which originally appeared in the novel Ivanhoe by Sir Walter Scott and refers to Italian and French mercenaries willing to offer their ability with a lance in return for payment from the nobility wishing to protect their land): a band might actually consist of a number of deps, occasionally there are more deps than regular members. Smart band leaders develop and maintain a list of reliable deps continuously and a full band is, for many such leaders, never more than a few phone calls away.

While some musicians are seen as regular deps, the one-night stand is a more common feature of the life of a working musician. The one-night stand has of course, another connotation, a one-off amorous encounter, but in this instance the phrase is used to distinguish the single night of paid work from more stable (yet still notoriously unstable) work, sometimes referred to as a “residency”. This meant more to musicians 30–40 years ago than it does today. A resident gig would typically be one in which a band leader would hire musicians to fulfil a contract he or she has with a particular venue. Musicians are hired mainly for their ability to play the written music in front of them, often without rehearsal, but reliability is a key factor too. Band leaders frequently move from being simply leaders of bands to being quasi agents hiring and paying the musicians and taking a cut from the overall fee as well as their own fee for playing and leading.

Resident gigs were usually coveted because they provided a relatively stable source of income, albeit again temporarily, allowing the musician to play more satisfying music elsewhere that didn’t pay as well or at all. The Musicians’ Union (MU) in the UK insisted that musicians be paid a minimum amount but this only prevailed in certain formal settings, such as theatres, shows, television and radio work as well as professional orchestras and cruise liners engaging musicians for contracts lasting months and travelling the world. The MU was then largely the preserve of professional musicians and its pronouncements largely bypassed informal social club bands and summer seasons at holiday camps. By most accounts even though this kind of work could be repetitive and boring, it could, in turn, be cash-in-hand and so bypass the taxman.

At the beginning of the twentieth century the word “gig” was associated with American jazz musicians who would refer to an engagement as a gig. There is also the enchanting possibility that the word gig was originally an acronym for “God is Good”, a phrase used by those musicians in thanks for having been offered paid work.² “God is Good” conveys the fortuitous nature of the paid work and potential divine intervention. Whether this is true or not, the notion offers some help in understanding the phenomenon; namely that people offered a gig may be in some way grateful to someone else, and it also suggests that they are unable to make that happen for themselves, relying instead on the good graces of others to provide them with work and therefore income, either way, gigs were temporary, infrequent and badly paid.

The nature of the gig worker and the gig relationship

Now, in the twenty-first century, the word “gig” has come to mean any performance, task or engagement at all, paid or otherwise, regular or not. Indeed, the word is no longer even used to refer to live music and is routinely used by musicians, DJs and indeed audiences all over the world. The nature of gig work has been characterized here as temporary, unreliable and fortuitous, but what about the characteristics of the gig worker? Perhaps the most abiding impression created by the notion of the gig economy is that of the gig worker as a free agent pursuing the next job in return for money, yet in no way beholden to the company that supplies the work: free to pursue whatever he or she wishes and even not to work at all if they so choose, with no semblance of any long-term expectations attached to any work that they undertake.

What about the relationship between the gig worker and the “employer”? We would not be the first to have noted the pre-existence of the gig economy. Harvey et al. (2017) have argued that the advent of the current gig economy is well described as a form of “neo-villeiny”. Villeiny was a feudal arrangement of the Middle Ages in which the worker was in bondage to the lord to whom was paid a rent for the right to work the land even though there was no guaranteed income from the land in terms of crops. Labour was speculative and unpaid, and benefited the landowner.

But is it substantially different now? In their survey of UK self-employed personal trainers working from fitness centres they found the same conditions exist in the twenty-first century; an expansion of hyper-flexible and precarious work. The authors note however that many of the personal trainers they surveyed through participant observation had “chosen” this arrangement as a route to independent income and a way to embrace entrepreneurialism. However, Harvey et al. also revealed that the personal trainers working in this way pay the fitness centre rent and have no guarantee of income while doing unpaid and speculative work that benefits the organization (ibid.).

Tempting as it is to argue that we have returned to a feudal economy (but with a more palatable name), the current notion of the gig economy, some have argued, has one key difference. Contemporary hyper-flexible and precarious work, it is argued, is largely a matter of individual choice. This was not the case in feudal England, villeins were little more than slaves to the landowner whose position was given by the king whose own position was divinely appointed. The weight behind the economic arrangements of the time was not simply the market, but religious and regal. The medieval mind did not allow for questioning the feudal system because it was rooted in religion and the monarchy, this arrangement was God’s Will.

Now, and since the Enlightenment in the West, we have largely jettisoned religious explanations and prescriptions for life in favour of a scientific understanding and the social relations between us are also less obviously influenced by religious doctrines. While the medieval mind took social relations to be God’s Will and therefore little to do with choice, the argument put before us with regard to the gig economy is that those engaged in such work have a choice, and this is bound up with the notion of flexible working. There remains, however, the question of whether a contemporary gig economy worker actually has this choice, a point to which we will return later in the book.

The relationship between stakeholders in the gig economy is also served well by another use of the word gig, as part of the word “gigolo”. The gigolo is a male escort or social companion who is supported by a woman in a continuing relationship, often living in her residence or having to be present at her beck and call.³ It is this latter connotation that matters, as we shall see, the gig worker is usually required to be at the beck and call of the “employer”. The relationship is seen as transactional, but is it equal? Needless to say, companies pursuing this form of labour arrangement argue that the people they pay to do this type of work are able to choose whether or not to carry out these very short-term contracts; for them the arrangement is one in which two parties agree on a contract freely and may opt out of such contracts in the future. The appeal is therefore to the notion of the market as a place where all parties are in some way equal, at least in as far as they are “free to choose” (Friedman 1979). But are they free to choose? Are drivers and people on bicycles delivering small items from a box strapped to their back actually free to opt out of that arrangement? Would the phone stop ringing or text messages offering them a new gig dry up if they were rejected too often?

The notion of the free market may also need questioning (as it has been for a very long time). Such an idea suggests a level of equality between the different parties. Yet this is very unlikely, as Adam Smith was well aware in the eighteenth century: “people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices” (Smith 1776/1982).

Large corporations have more information and more information processing capacity; they can buy that intelligence, to which the driver or delivery person does not have access. Many would argue it is not a perfect market as there is no perfect information. Yet, they point out, we continue to adhere slavishly to the central tenets of the free market economy. Does the market really provide as equally as this, or is it really in favour of the big corporation? These questions will be addressed later in the book.

Given the nature of the relationship between the gig company and the gig worker as presented above one of the casualties of the gig economy might be the notion of loyalty. The idea of “jobs for life”, often associated with working in a government function such as the post office (GPO), is a thing of the past. The phrase “job for life” would often be accompanied by the phrase “set for life” implying that once such a job had been landed so your employment worries were over until retirement. There was, in these jobs, the sense that you would be “looked after” by a paternalistic company. In return for your loyalty you could expect security of employment, a gold watch after a lifetime’s service and a final salary pension on retirement. This security would be seen as highly prized following the leaner years before, between and during the two world wars. The notion of reciprocated loyalty may have been somewhat romanticized, but it was not an uncommon experience for the baby-boomer generation. However, their children were to be disappointed as government jobs and public providers became commercial concerns with as much propensity to lay people off as any commercial company. The company’s reduced sense of loyalty to employees was further demonstrated in the 1980s following the decimation of the trades unions.

Conclusion

This brief survey of the uses of the word “gig” has illuminated the key features of gig work, the gig worker and the relationship between them. Gig work is precarious, infrequent, badly paid, unstable and fortuitous, while the gig–work relationship is seen as transactional but unequal. Perhaps one of the most striking features of the use of the word “gig” is its warm familiarity. It conveys a lightness of activity, frivolity and even humour. The Oxford English Dictionary has an entry that defines the gig as a joke or merriment. Images abound of the bohemian musician living from day to day, grateful for the next gig, frequently out of work yet glad to be outside the strictures of “normal” society. In turn, proponents of t...