Let's look at Uber. Before Uber, taxi drivers (which are also independent contractors), paid a gate, say $100 to rent the can for 12 hours. Then they got to keep whatever they earned, minus the $100, and minus gas. Minus bribes to the dispatchers, etc.
This means some days cabbies would lose money. Some days they would make a lot. The introduction of Uber reduced risk, because Uber takes a percentage, say 30%. This percentage system rather than a gate significantly reduces risk for cabbies.
One of the big misconceptions here is that more people are working non-traditional jobs. That we now live in a "gig economy". This is false.
epi.org/publication/no…
epi.org/publication/no…
Why do the media keep pushing this narrative? Other than the general decline in competence of our media class, one can't help but think that this is because of tech. We've seen tech companies take over traditional gig employers. E.g. Uber taking over taxis.
But journos *hate* tech, since it destroyed their business model. Thus any area in which tech is making an advance is portrayed as a national crisis that needs solving, even though in most cases the result is a decrease in risk rather than increase.
There are real concerns about tech, but those concerns have nothing to do with everyone working in the gig economy and bearing more risk. The real risk here is to _consumers_ not workers. The risk is that tech allows firms to violate the law of one price
E.g. they can data mine what you are willing to pay and then charge you an individual price designed to maximize what you pay. They can seize the consumer surplus. How do you know that the price Amazon is showing you or the rate Uber charges isn't designed just for you?
This, together with concerns over data privacy, are the true dystopian risks of tech. But they have nothing to do with the "gig" economy.
