The way Americans work is changing rapidly, but our bureaucratic, slow-moving institutions are not keeping up. The Wall Street Journal reports
Uber drivers aren’t the only “gig” workers rattling the U.S. economy. Older workers, especially women, increasingly are filling in as contractors across a range of traditional industries, from highway inspectors to health aides.
As companies look to shed noncore tasks and government budgets come under strain, an expanding share of the workforce has come untethered from stable employment and its attendant benefits and job protections.
Workers in these alternative arrangements often find themselves with erratic schedules, spotty earnings and few benefits such as health insurance, Social Security or a retirement plan. Some arrangements, like subcontracting or independent contract work, raise questions about worker safety, employer liability and consumer protections.
These new forms of work are going to continue to expand, and under the right conditions they can mean more flexibility for both workers/contractors and the businesses that bring them on. But we still have a system of benefits and regulation based on the old model—the paternalistic corporation. Benefits ranging from health insurance to retirement savings to unemployment and disability have yet to be established in a sustainable way for this new class of workers. There’s an opening here to create a new kind of financial services firm that can process payments and manage benefits for contractors and businesses in the gig economy, but this will be difficult to accomplish without changes to state and federal employment law.
Over time, more and more Americans will likely operate in the gig economy, mixing part time and temporary employment with independent contractor jobs. People who work in this world should not be second class citizens, and they should not be inundated with the crazed paperwork requirements of an employment system that is oriented to old-fashioned long-term employment. Taxes need to be collected, retirement savings need to be accumulated, and people have to be included in disability, healthcare, and unemployment insurance programs, some of which will need to be redesigned to accommodate job-hopping and gig work. And that structure needs to be flexible and cost effective enough to make it easier for businesses to create jobs and for people to piece together a living from several different activities.
All this is part of one of the most important and complicated tasks our society faces: creating an institutional and legal framework for an information economy that will be as different from the industrial economy as that economy was from the agricultural economy that came before it. At the moment, both political parties seem more interested in peddling competing brands of nostalgia than in promoting a workable vision for the post-industrial economy in which millions of Americans already live and work.