Traditionally, our speakers' talks have been off the record unless they waive that practice. We've decided that occasionally -- in instances where speakers are willing to set aside that tradition and their perspectives on important issues are particularly thought-provoking -- that we will work with them to post summaries of their talks on our site. Such was the case at our May 25, 2017 dinner, when Wilma Liebman spoke about "The Gig Economy and the Global Labor Market." She is a co-author of Crowdwork - A Comparative Law Perspective (published in 2017 by Bund Verlag in Germany).
Liebman, the third-longest serving member of the National Labor Relations Board, was designated in 2009 by President Obama to be his first chair of the NLRB. She was first named to the board by President Clinton, then reappointed twice by President George W. Bush. Earlier, she was labor counsel for the Bricklayers and Allied Craftsmen and legal counsel for the International Brotherhood of Teamsters. Currently, she is a visiting scholar at Rutgers University's School of Management and Labor Relations.
A Global Policy Issue: How to Make Labor Markets More Worker-Friendly
Wilma Liebman sees a world where governments everywhere are struggling to catch up with the sweeping impact of new technologies and other changes on labor markets.
In her talk to the Committee, Liebman described how technology has given rise to a new global online labor market -- a niche of the so-called "gig economy" where workers are available 24/7, willing to accept short-term free-lance assignments, often at low pay and without the rights, benefits and protections that employment status entails. While these arrangements offer both firms and workers flexibility, she pointed to growing scrutiny of whether this type of work is eroding labor standards and workers' rights worldwide and fueling anti-globalization populism.
"We are in a time of disequilibrium," she said. These technology enabled business models and forms of work often exist in tension with traditional legal and regulatory regimes for overseeing labor markets, but new systems haven't yet emerged. One result has been a tilt toward favoring capital, often at the expense of labor, and as more people feel left behind, political risk escalates.
"We are sitting on a tinderbox and technology is only one of multiple pressures that could ignite it," she said, pointing to research done by Thomas Kochan, an industrial relations professor at MIT's Sloan School of Management. Among the pressures identified by Kochan: the movement toward populism, social tensions, income inequality, a backlash against globalization and trade and fears that technology is "eating our" jobs.
For a defining perspective on the gig economy, Liebman cited a 2016 study done by two economists: Lawrence Katz from Harvard University and Alan Krueger from Princeton. They found that between 2005 and 2015, the share of all workers engaged in "alternative work arrangements" -- temporary help agency workers, on-call workers, contract workers and independent contractors (free lancers) -- rose from 10.1 to 15.8 percent, a 50% increase. Alternative work arrangements accounted for all of U.S. net employment growth over this period, Katz and Krueger concluded. Most of this growth has been in offline work. Workers who provide services through online intermediaries, such as Uber and Task Rabbit, accounted for a minimal share of all workers -- just 0.5 percent in 2015 -- but the study found that this share has been growing rapidly.
Much of Liebman's talk dealt with the growth of online intermediaries, particularly Uber, that are widely seen as global trail blazers in what has been dubbed "the sharing” (or “gig”) economy. She also cited concerns about Amazon's "Mechanical Turk," a “crowdwork” platform that enables companies (called “requesters”) to post low skill microtasks, labeled “human intelligence tasks” that take a few seconds or minutes to complete and require human cognition – e.g., transcribing text from receipts, identifying images or paraphrasing sentences. Workers compete for these tasks on the platform. The average payment for the tasks posted on Mechanical Turk is extremely low (generally a few pennies), and the requesters avoid the taxes and regulations that apply in traditional employment relationships. Mechanical Turk has been called a “digital sweatshop.”
Liebman cited the comments of a top executive from one of the world's largest multinational banks at a late 2015 symposium on the future of work. When CEOs are asked what keeps them awake at night, the executive said, they often reply that it's their workers. Many CEOs will "do anything possible not to hire another full-time employee," he told the audience. Frequently they believe that "Technology often does it better. People are a pain to manage."
But the good news, Liebman said, is that Uber and the gig economy have triggered multiple policy debates about how technology is changing the workplace: whether it offers promise or peril – good jobs or bad jobs. "Future of work" symposia have become common, tackling a wide range of issues, and ultimately, that could lead to a new social contract that addresses deep worries about economic security, labor standards, social protections and worker bargaining power in the 21st century.