We Need the Gig Economy Now More Than Ever
Forced to limit our social interactions to get through this pandemic, millions of us are using apps and online services to try to bring some measure of normalcy and convenience to our lives.
Demand for food and alcohol delivery is through the roof and thousands of other platforms are still popular and ripe for a comeback once restrictions and lockdowns are lifted.
But for many users and consumers, the pandemic is revealing the very real regulatory problems limiting the sharing economy.
Especially now, we need functioning and smart laws that empower those who use the gig economy, not penalize them. This is especially true for low-income Americans, who are more than likely to use these services to supplement their incomes or save money.
In California, the sweeping law that went into effect in January classifies practically all workers as employees. This measure has, as predicted, practically wiped out the state’s 5 million freelancers and contractors, removing their ability to gain independent income.
Instead of hiring freelancers full-time, companies have been eliminating positions or leaving the state altogether.
Musicians, freelance journalists and rideshare drivers, who once benefitted from their independent status, have found it more difficult to make a living. It’s no surprise that practically every industry has been jockeying for an exemption and a rewrite of the law is eminent.
For home sharing, local jurisdictions have placed caps on the number of properties available for short-term rentals, curtailing the supply. New York City and Seattle require hosts to obtain both business and rental licenses that can cost thousands of dollars.
In cities such as Des Moines and Las Vegas, rental properties cannot be within 600 feet of each other, and countless others require audits of how many guests can be in each bedroom. That’s put homeowners in a pinch, and revealed the lobbying efforts behind those restrictions.
Too often, regulators and politicians have folded to the demands of the industries that once held monopolies over hospitality services, such as hotels and car rental agencies.
In many states, for instance, rental car companies have banded to severely restrict peer-to-peer car-sharing apps, such as Turo and Getaround, which allow car owners to rent out their vehicles to drivers for reasonable rates.
In states like Florida and Arizona, Enterprise and National Car Rental have succeeded in lobbying to ban these apps from offering vehicles at prime locations such as airports and requiring them to collect rental car fees.
These are the types of restrictions and anti-consumer laws that are not only holding back the gig economy but are threatening its existence altogether.
Of course, the effects of the pandemic on the sharing economy cannot be overstated. The behemoth sharing economy companies such as Airbnb, Uber and Lime are struggling with fewer people traveling and using their services. But that is not how we should measure the success of the gig economy.
The promise of the sharing economy has never been about gains on Wall Street, bold corporate executives or even profits for investors. It is not about a single company’s bottom line or its market share. Rather, it has always been about offering new and innovative options to empower people like you and me to improve our lives.
The sharing economy empowers both consumers and entrepreneurs to creatively and collaboratively use or lend resources they otherwise wouldn’t. That allows people to earn additional income as owners and save money as users.
Whether it is ridesharing, carsharing, home sharing, the sharing of tools, or e-scooter rentals, the regulations on the sharing economy should not make them more difficult to use or from which to profit.
If regulators want to help consumers and owners, they should take legislative steps to legalize or ease restrictions on all sharing economy services. Giving people more access to sharing economy services would provide much-needed income to families in need and would help reduce costs for millions more.
The question is not whether the gig economy should be regulated or not. It is whether it is accessible or not. Reasonable and smart regulation would solve those issues.
The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.
The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org
