The Government Shutdown and the #GigEconomy

There have been several articles so far this year about how furloughed federal workers are using the gig economy to make ends meet; A recent Fast Company article indicated that services offered on the digital talent platform, Fiverr, in the Washington DC metro area increased by 41%. That means that the number of people putting themselves on the site for projects spiked in a way that was unheard of in other post holiday periods. That said,the report did not suggest that demand for those services increased in a similar fashion. Fiverr is a platform for business to business services primarily, so the author lamented that the model is not one that can necessarily help with immediate cash needs.

On demand platforms, like those for drivers, deliveries or unskilled tasks can potentially provide such stop gap funding.  Lyft has posted several appeals on its twitter feed for furloughed workers to consider driving to ease the pain.

Similarly, Postmates offered incentives, including a free charger, for government workers who signed up. They noted they have seen a significant spike in applications since the onset of the shutdown in December. A new start up in San Francisco, House of Gigs, will pay a one-time start-up bonus to any federal worker who completes a gig through its app.

Hopefully all these efforts will enable some federal workers to get some gig income which can lessen the financial pain of going without paychecks.  Indeed, many independent workers are part-time freelance workers; for them, gigs represent extra money to supplement a current employer.  Although in all the studies to date, those employers typically paid their employees.

There are a few ironies to the fact that gig work may be helping some federal workers cope with the shutdown.  The first is that the government really doesn’t understand the gig economy. The growth in independent work is stunning in many respects, but it has gone fairly unnoticed in Washington.  Certain lawmakers, like Senator Mark Warner, have advocated changes to our social safety net and employment laws to support this growing movement, but these efforts have not had much traction.  An Op Ed piece in Forbes last year attributed that to the fact that regulators need to understand the platforms they are regulating.  Perhaps as more federal workers supplement their income on these same platforms, the government will gain a better sense of how these business models are reshaping the landscape of work.

Another irony lurks at the cause of the shutdown – the idea of a wall at the border. Anyone who has worked with the digital talent platforms in the knowledge economy understands that expertise knows no border. When folks think about the gig economy, they think of the On-demand, less skilled sector which may provide some short term assistance for furloughed workers, but there is a very robust services sector that is grounded on specific expertise.   I have done gigs on Fiverr with IT folks in Morocco, Bangladesh and the UK.  My current web developer/marketer is an American Upwork freelancer who lives in Germany.  Upwork, who went public in October and has a market value of over $1.5 billion, said in its prospectus that only 20% of revenues from freelancer fees are US based workers. That in and of itself demonstrates the globalization of talent.

There are issues with this globalization of work – issues that will need to be addressed by governments.  As such, isn’t it time for the government to get back to work? However when it does, it may find some federal employees may not want to return.  The majority of independent workers choose to work that way  because they like to have the control over their lives. In fact, a majority of freelancers report they will not go back to regular employment, regardless of the compensation.  They don’t want to be at the whims of employers who may decide to close down a plant , reduce the workforce or not fund payroll because of a government shutdown.

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