The Trouble with the "uber for…" Economy

Zeynep Tufekci (@zeynep)

October 20, 2015


Susan Crawford and Tim OíReilly, along with hundreds of others, have had an important exchange regarding Uber versus taxis on Medium. Susan points out why physical transportation systems are so important to the fabric of our cities and that Uber is squeezing its drivers as tightly as it can, taking a big cut. Tim OíReilly responds out taxis have never been a good deal for drivers either. Tightly regulated taxi medallions cost as much as a million dollars and drivers end up renting the taxis at substantial sums while medallion owners make the bulk of the money. OíReilly might have added that many people find it hard to get taxis at peak periods – especially if they are not white, or are trying to travel outside of Manhattan or a similar enclave in another town. Susan suggests we should make taxis better, and lower cost for everyone. Iíd have added that Uberís data practices are atrocious (and joining its management seems to require a degree from a finishing school for uncouth behavior).

But what if the problem is not just Uber the company, or its business practices?

Letís separate out Uber the company (with all its jerk behavior) from the concept of a taxi hailing app that brought us all the pitches to angel investors. On the one hand: thatís how we should call all taxis, obviously. (There is no reason regular taxis cannot be called by a taxi hailing app). The concept is overdue so itís no surprise that so many other startups are trying to move into this space. Iíve read many accounts of pitches to investors just like that: Uber for shopping, Uber for your laundry, Uber for walking your dog. Letís call these small-u Uber as in "uber for…" This is the so-called sharing economy or gig economy, the heart of which is using technology to optimize service delivery cheaply, but often by having cheap labor be on-call all the time, to be summoned at will according to the need of those who can afford to pay.

What if the reason Uber raises so much ire and anxiety is not about whether Uber, the company, fails its drivers better or worse than medallion owners fail their own drivers, but because the "uber for …" economy is threatening to make the lousy conditions for taxi drivers, once seen as a temporary job for first generation immigrants, into the jobs of the future? I want to take a step back from whether taxis are worse than Uber, and focus on what it means for "uber for…" economy to represent jobs for a bifurcated future.

There are so many around that we need an Uber for creating an "uber for…" pitch.

It sounds great, except for the ugly reality which lurks under the proliferation of "uber for…"s: the calcification of the two-tiered system between the overworked who need and can afford the "uber for…"s and the underpaid who are stuck in its 1099 economy of unstable, low wages.

Taxis have traditionally been driven mostly by men who cannot find other good employment in the U.S., primarily first generation immigrant men. These men are not always low in skills: most of us have ridden in that cab driven by a doctor from Ghana whose license does not allow him to practice here. Many taxi drivers are learning English as a second language as adults, a difficult task (unlike learning it as a child, which is a very easy task due to how our brains are wired for language). These men (they are generally men) can almost always drive. For past many decades, driving has absorbed many such migrants into the labor pool. (This is true in many other settings as well as migrants to big cities end up as drivers of taxis around the world). These men may drive taxis, but have hopes that their children will go to school and find better jobs: maybe a doctor or lawyer by the third generation. The job mostly sucks, but it is a job for a transitional generation.

We are seeing a bifurcation in societies between this group of people, the "uber for…" workers, and people who are making relatively good money, but are desperately overworked and are chronically short on time. The first group who are stuck at low-wage jobs. Letís not kid ourselves. Very few of them, or their children, are likely moving up (unless there are significant structural changes to how we organize our economies). The second group are stuck at jobs that take too much out of their lives.

The same combination of political disempowerment of workers along with technology that further decreases worker leverage through automation, deskilling, outsourcing and globalization of capital – but not globalized labor since people are stuck behind borders as capital moves around the world. (See the latest crisis about refugees as well, also the tensions over immigrants). This trend predates the "uber for…" economy – growing "flexibilization" of workers, which meant making them fit employer/company needs at the expense of stability and higher wages has been on the rise for decades. But the "uber for…" economy has now brought a technological and regulatory means to bring this trend fully home. This is bringing about a growing underbelly of underpaid and underemployed mass of people in this country. Some in richer countries can be convinced that itís the immigrants seeking a better life who are the source of their woes, as they fall downward to increased anxiety and threat or reality of job loss. (This is an old story, by the way, and it did not turn out well for the world the last few times).

The first group – well-paid, chronically over-worked and thus badly squeezed for time – is now outsourcing more and more of its tasks to the second group: the under-paid, chronically underemployed who wait on-demand for scraps of jobs.

Thatís the "uber for…" economy that generates so much anxiety.

This is not a lamentation that some jobs are underpaid. There is nothing wrong with entry-level jobs; or jobs for first generation immigrants without full language skills. (Some immigrants who come to this country are highly skilled; but thatís another story). The problem isnít division-of-labor, or the fact that not everyone gets a great job, especially when they are new arrivals in a country. And, itís true that some jobs by their nature take a lot of time, especially if they depend on particular and specialized knowledge held by few. Some people in such key posts tend to be overworked. It makes sense to divide up some tasks and chores in exchange for money.

But whatís happening now is something deeper, and more structural.

Large numbers of people are overworked simply because they can be. The same technology that allows them to call a cab on their phone makes it possible for their employer to compel them to answer emails at all hours or be on call. Many of these overworked people are doing the job that should be done by 1.5 people, at least. Most of the time, they are not doing that extra half a weekís worth of work because they are otherwise irreplaceable: they are just pressured to work that much. They have money, but little time.

Large numbers of other people are trying to make a living by patching together the jobs that come along and are working at "uber for…" jobs because they canít find full-time, reasonable employment. They have time, but little money.

So hereís the next question: what if Uber (the company or another company that comes along and does the same service) works out great for getting rides in cabs and the "uber for…" economy solves the problem of not having enough time for chores or getting places for the well-paid overworked group?

What if the problem with Uber is that if it works well, it signals the "uber for…" economy that calcifies our separate and unequal tiers?

Consider what we are not discussing (though Susan alludes to it): Buses that are so infrequent that they are useless. Ailing rail infrastructure. Crowded (also ailing) subway systems.

Many of the "uber for…" pitches would not work if there were not a significant number of people willing to work, without worker protections, without a schedule and without a stable wage. Yes, some people are seeking part-time work, and some entry-level work is great for young people. But our underemployment problem has gone beyond that.

The looming of the "uber for…" economy is why I think many people are so riled up and anxious about Uber: they see in it a potential future in which a few of us whizz around in well-maintained cars that we call from our smartphone, and answer emails while we ride on new suspensions, while a vast majority are waiting for an overcrowded bus or subway that seems to be stuck two stations away.

Maybe people are wary of Uber because they are sensing that the growing "uber for…" economy means they missed the bus – and not because they were late, but because the bus either no longer passes by their stop or has no room for them if it does.