Future of Sharing Economy in Question as Elections Approach

Candidates take Stance against Uber, Sharing Economy Jobs

Sharing Economy

Over 1 in 3 American workers, nearly 53 million, are freelancers. In a Monday address, Hillary Rodham Clinton, in preparation for her candidacy for President, laid out her economic agenda at a conference in New York City. Hilton cited sharing economy jobs as a possible damper in wage growth for the United States.

Since the recession, more lower-wage positions are available across the nation, as the lower wage jobs are outpacing the higher wage jobs according to the National Employment Law project. With 2.3 million more jobs in lower wage brackets since the recession, and mid to higher wage jobs being cut by over a million, the numbers speak for themselves in regards to the way the national job trend is turning.

Sharing Economy

Clinton’s views regarding the sharing economy and its effects on wages and the job market as a whole have been echoed by other democratic candidates, and most likely will take shape more towards the coming election. Most likely, the tech freelancer, according to CNBC, will become a large part of the 2016 elections. Reasons for candidate’s disapproval of the gig economy center around the discrepancies of companies such as Uber and Lyft to clarify their employees as employees or independent contractors. In her monday speech, Clinton said, “I’ll crack down on bosses that exploit employees by misclassifying them as contractors, or even steal their wages.” Paul Osterman, a professor at the MIT Sloan School explained the benefits, and problems, of those classifications.

“If the jobs meet people’s needs for flexible employment and provide learning skills and pay decent wages, then they are certainly a positive for the economy,” Osterman said. But he went on to discuss that if the freelance jobs “result from misclassification to avoid paying benefits or employment taxes”, that could be the larger issue at hand, the reason for the expansion of the lower paid job bracket, and the “source of worsening job equality”.

Bernie Sanders jumped on the anti-Uber bandwagon and in an interview with Bloomberg News declared his “serious problems” with Uber, as it’s “unregulated”. Martin O’Malley, yet another 2016 presidential candidate, has called for a “safety net” regarding Uber drivers getting employee benefits, something they’re not required to obtain when working as private contractors, as the company currently has them. Many lawsuits are in the works with suing the startups, Uber and Lyft, to be considered as employees.

Sharing Economy

However, some republican presidential candidates, such as Jeb Bush, are in favor of the sharing economy. A new Wall Street Journal analysis shows that the sharing economy may just not be as large or as dominant as one would expect, with Uber and AirBnB hitting Forbes’s Unicorn list as top billion dollar startups. According to a study co-authored by one of Clinton’s economic advisers, Alan Krueger, a Princeton professor, Uber drivers continue to make almost $7 more per hour than regulated taxicab drivers. But the question is whether or not this takes into account the benefits, or lack thereof, and employee credentials that separate independent Uber driver contractors and certified employees of taxicab companies.