New deal or poor deal: how do workers fare in the gig economy?

Human Capital

by Ben Williams, Chair of the Association for Business Psychology

Industry View from

New deal or poor deal: how do workers fare in the gig economy?

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The gig economy is a phrase most have come across by now as we march rapidly towards the close of the second decade of the 21st century. But just what does the gig economy mean for workers and who, exactly, benefits from this “new career deal”? The gig economy refers to a labour market dominated by short-term contracts or freelance work rather than permanent, full-time jobs. Depending on your point of view, it’s either an opportunity for flexibility, autonomy and entrepreneurship, or a form of exploitation with limited workplace protection.

There are certainly big businesses thriving off non-traditional employer-employee relationships, having seemingly relegated ideas such as job security and workers’ rights (so “last century”) to the scrapheap. In return, they offer the allure of self-determination and flexi-time.

James Bloodworth, journalist and author of Hired: Six Months Undercover In Low Wage Britain, spent time in “various precarious and low paid jobs” to uncover what being a worker in the gig economy is really like. His finding was that, often, the promises on which the gig economy is based – autonomy, flexibility, and being one’s own boss – don’t translate into reality. Low rates of pay per hour and peak hours of demand (a narrow window in which one can make a living) mean that “work your own hours” really means having to put in long, standard hours on a continual basis.

Bloodworth, interviewed at the 2018 ABP conference themed around the “New Career Deal” for the ABP podcast on the gig economy, also noted how working conditions were often very poor, characterised by high levels of control, the threat of loss of the work, and in some cases, humiliation. To add insult to injury, the psychological disillusionment and disappointment at those promises of autonomy and flexibility being mere buzzwords left those workers feeling tricked and resentful, further decreasing the quality of the work experience.

And it is this quality of the work experience that is so crucial to the worker in the gig economy, as Senior Policy Advisor and Chair of the RSA Matthew Taylor knows. The author of a government-commissioned report entitled Good Work: The Taylor Review Of Modern Working Practices, Taylor is primarily concerned with ensuring that organisations in Britain become better places to work and providers of “good work”.

According to Taylor, as outlined in his keynote speech at the ABP conference, good work matters. It matters now more than ever, as we see the old psychological contracts that promised economic stability and annual betterment so long as one stayed in a long-term, steady job, breaking down. With those prospects gone and not looking likely to return, at the very least, Taylor says, workers need the reassurance that they will be treated decently, for “every job to be fair and decent and offer scope for development”.

However, in Taylor’s view, far too much of the work done in contemporary organisations is not good work.  Good work, according to Taylor, is work that meets the full spectrum of an employee’s needs. In the first instance, this means the baseline needs of fair remuneration and working conditions. Indeed, the Taylor Review led to new legislation in December 2018, giving gig economy workers greater rights in terms of pay and benefits such as leave. However, Taylor also emphasises the importance of interpersonal connections, feeling supported at work, having a sense of purpose and enjoying a degree of (real) autonomy. He calls for organisations to take quality of work more seriously, and to start thinking innovatively about how to run organisations – with better and more effective ways of working.

Ultimately, and unsurprisingly, as Taylor says, “in the end, the single most important determinant of your experience of work is the quality of management that you experience. The one thing above all else that you want to influence is the quality of management and we need organisational forms that encourage better, more generous, more creative forms of management”.

And thus, in a new economy, we revert to an old maxim: leadership matters. Creating environments where people are empowered to produce their best work, regardless of the type of contract they are on, is the domain of leaders. And organisational leaders, according to Taylor, still don’t take the quality of work as seriously as they should. The focus should be on creating positive, engaging climates with real scope for progression. Prioritising productivity over all else is simply not going to work.

Lucy Standing, Vice Chair of the Association of Business Psychology, concurs, adding that, from a psychological perspective, a sense of autonomy and self-control is highly empowering for people and usually leads to enhanced satisfaction and output at work. According to Standing, “The more organisations can drive people to feel more personally responsible for their actions, the better and happier those people will be.”

If you’re interested in hearing more about worker’s experiences in the gig economy, listen to the ABP podcast on the New Career Deal.

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© Business Reporter 2021

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