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Don’t be played by the ‘gig economy’ hype

This article is over 5 years, 3 months old
A new report hails the ‘digital platforms’ that are making workers ‘independent’. But the claims are misleading, writes Alistair Farrow
Issue 2526
Do these delivery workers work for themselves—or for Uber?
Do these delivery workers work for themselves—or for Uber? (Pic: Guy Smallman)

Is a “gig economy” transforming the world of work? That’s the claim of a report released last week by the fat cats’ number crunchers, the McKinsey Global Institute (MGI).

It claims that between 20 and 30 percent of the working age population of the US and the European Union’s (EU) 15 founding members are in “independent work”.

This is defined as someone who, in the last 12 months, derived “some” of their income from “independent activities”. These include “providing labour, selling goods, or leasing assets.”

Three key features of independent work are described as “a high degree of autonomy, payment by task, assignment, or sales, and a short-term relationship between worker and client.”

So it suggests a major break from the model of someone hiring out their labour to a boss for a wage. But things aren’t so simple.

By this definition, a full-time worker who owns their home and rents out a room on the side is an “independent worker”.

Over half of those identified as “independent workers” by the report do it to provide “supplemental income”. So they could also be full-time workers.

More typical of the “gig economy” image is someone who drives their car as a taxi for Uber or delivers fast food for Deliveroo. The report claims that such “digital platforms” are transforming work.

But while their adverts emphasise the chance to work “independently”, the workers have often been pushed into nominal self-employment by the bosses’ needs.

The report says some 30 percent of those doing “independent work” do so “out of necessity”. Many of these people rightly regard themselves as workers.

It’s not an academic question. As self-employed contractors they are denied a steady wage and even statutory employment rights. As workers they can get together and fight for them.


The MGI report is one of a series to wildly overstate the trend.

Actual self-employment, it concedes, stands at 8 percent of the working age population in Britain, 6 percent in the US and 8 percent across those

15 EU countries. The majority of people remain employed in “traditional” employment.

MGI’s definition of “independent work” is based on its own dataset of questions asked to 8,000 people.

It then uses more thorough data from individual countries to back up its claims. It also “scales up” data from countries with quite different economies to represent the 15 EU countries as a whole.

One of the key arguments put forward in the report is that labour markets need to respond to this alleged change in the nature of work by developing “digital platforms”.

Similarly, a previous MGI report released last year pointed to online job websites like Monster and LinkedIn as ways of addressing underemployment and unemployment.

Behind this is the argument that there are enough jobs for everyone—it’s just a question of bringing the employer and the worker together using “innovative” methods.

But unemployment is a product of the capitalist economy. No clever app is about to make it disappear. Nor is a digital “gig economy” transforming the nature of work.

It is, to an extent, being used to scam workers out of their rights. That’s something only the bosses have any interest in talking up.

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