Tag Archives: gig economy

‘Breaking the bias’ – gender equality and the gig economy

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Yesterday marked the 111th International Women’s Day, a global day of celebration for the social, economic, cultural and political achievements of women. But it is also an opportunity to reflect on and further the push towards gender equality.

While there has been much to celebrate, it has been suggested that the pandemic threatens to reverse decades of progress made towards gender equality as women have been hit harder both socially and economically than men. However, the shift in working practices during the pandemic may help to transform the future of work to the benefit of women.

There has been continued growth in the digital platform or gig economy workforce, with many women entering this type of work because of the pandemic. The gig economy has been shown to have the potential to improve gender equality in the economy, but it is not without its challenges when it comes to gender parity, as recent research has highlighted.

A platform for gender equality?

The report from the European Institute for Gender Equality (EIGE) highlights that the growth of artificial intelligence (AI) technology and platform or gig work has the potential to create new opportunities for gender equality, but at the same time can reinforce gender stereotypes, sexism and discrimination in the labour market. It found that some of the key attractions of gig work such as its flexibility, are often disadvantageous to women.

The EIGE surveyed almost 5000 workers in the platform economy across 10 countries to understand who they are, why they do platform work, and what challenges they face.  It found that:

  • a higher share of women (45%) than men (40%) among regular platform workers indicated that they worked on digital labour platforms because they were a good way to earn (additional) income;
  • flexibility, expressed as the ability to choose working hours and location, motivated about 43% of women and 35% of men;
  • a higher share of women (36%) than men (28%) said they do platform work because they can combine it with household chores and family commitments;
  • 36% of women started or restarted platform work because of the pandemic, compared to 35% of men.

The flexibility of platform work has consistently been referred to as the main motivating factor for engaging in such work. And this flexibility has been found to be more important for women, particularly in relation to family commitments. In practice, however, the research shows that flexibility is limited, with as many as 36% of women and 40% of men working at night or at the weekend, and many working hours they cannot choose.

On the plus side of the gender equality debate, it seems the gig economy is slightly less gender-segregated than the traditional labour market, with a higher share of men doing jobs usually done by women. For example, traditionally female-dominated sectors such as housekeeping and childcare are more gender-diverse in the gig economy:

  • housework (women: 54%, men: 46%)
  • childcare (women: 61%, men: 39%)
  • data entry (women: 47%, men: 53%)

But the EIGE’s survey also suggests a degree of skills mismatch and overqualification in platform work that affects women in particular. It suggests that highly educated women are more likely to do jobs that do not match their level of education, putting them at greater risk of losing their skills.

Gender bias in AI

The report also shines a light on the issue of gender bias in AI which can be a particular issue in the gig economy where such systems are frequently used.

It argues that gender bias can be embedded in AI by design, reflecting societal norms or the personal biases of those who design the systems. For example, the use of algorithms that are trained with biased data sets perpetuate historically discriminatory hiring practices which can lead to female candidates being discarded.

Platform workers can also be monitored using time-tracking software, which deducts ‘low productivity time’ from pay, increasing ‘digital wage theft’, to which women are more vulnerable.

Considering just 16% of AI professionals in the EU and UK are women – a percentage which decreases with career progression – this is something that needs to be addressed if gender parity in the gig economy, and indeed the entire modern economy, is to be achieved.

Way forward

The EIGE report welcomes new proposed EU legislation to improve the working conditions of platform workers and the EU’s proposed ‘Artificial Intelligence Act’, suggesting this shows promise when it comes to minimising the risk of bias and discrimination in AI. Also highlighted as a positive sign, is the EU’s commitment to train more specialists in AI, especially women and people from diverse backgrounds.

Nevertheless, one of the conclusions of the report is that regulations and policy discussions on platform work are largely gender blind and that action is required on multiple levels to address gender inequalities and discrimination in the gig economy.

To this end, the report recommends that the EU needs to do the following:

  • mainstream gender into the policy framework on AI-related transformation of the labour market;
  • increase the number of women in, and the diversity of, the AI workforce;
  • address the legal uncertainty in the employment status of platform workers to combat disguised employment;
  • address gender inequalities in platform work;
  • ensure that women and men platform workers can access social protection.

There are lessons here for the UK too. Perhaps the fulfilling of these actions will go some way to improving the situation by the time we get to the next International Women’s Day.

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The pros and cons of the gig economy

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By Heather Cameron

The ‘gig economy’, also described as the ‘sharing economy’, ‘collaborative economy’ or ‘on-demand economy’, has grown rapidly in the UK, a trend that is predicted to continue amid post-Brexit uncertainty.

A new study from the McKinsey Global Institute suggests that work in the gig economy is even more widespread than official data suggest, with 20-30% of people in the US and UK working independently. And while the report suggests the majority of these workers are participating in the gig economy by choice, a sizable minority are there reluctantly.

So what exactly is the gig economy and what are its benefits and drawbacks?

What is the gig economy?

The gig economy comprises enterprises such as Uber, the driver hire app, Airbnb, the accommodation-sharing platform, and Deliveroo, the online food delivery company. These enterprises enable people to use digital platforms to buy services from, and sell services to, each other.

A recent PwC study identified five key sectors within the gig economy:

  • peer-to-peer accommodation
  • peer-to-peer transportation
  • on-demand household services
  • on-demand professional services
  • collaborative finance

People that work in the gig economy, as described in the McKinsey report, are independent workers, rather than employees. Three key features of these workers have been identified:

  • a high degree of autonomy
  • payment by task, assignment, or sales
  • short-term relationship between the worker and the customer

Growth

The UK has seen higher growth in the gig economy than the rest of Europe, partly due to the recent establishment of London as a global financial technology (FinTech) hub. Transactions reached £7.4bn in 2015, almost double the previous year.

The number of jobs in the online gig economy advertised by UK employers increased by 14% between May and September, according to the Online Labour Index. This is around double the 7.5% rise elsewhere in Europe, and 6% in the US.

The McKinsey research estimates that there are up to 162 million independent workers in the US and Europe combined. The number of people classified as self-employed in the UK has grown by 47% since 2000, while the number of employed has risen by just 13% over the same period.

Pros

Supporters of the gig economy argue that it enables more people to participate in the labour market by providing flexible working, provides opportunities for the unemployed and could increase productivity.

Indeed, flexible working has proven very popular among the working population as more seek to achieve the perfect work-life balance. Those surveyed for the McKinsey report who chose independent work, reported greater satisfaction with their lives than traditional workers. They were more engaged in their work, and relished the chance to be their own boss and have more control over their hours. Even those working independently out of necessity reported being happier with the flexibility and content of the work they do, although they were less satisfied with their level of income and income security.

Both consumers and organisations can benefit through greater availability and accessibility of services and improved matching that better fulfils their needs.

And there is also the benefit of minimal cost. Digital business models have lower transaction costs for consumers, and organisations can keep costs down by using independent service providers only when they need them.

Nevertheless, challenges exist.

Cons

While there are more people in work than ever before, due in large part to the increase in self-employment, and despite the high levels of satisfaction among independent workers overall, there are concerns over job insecurity and low income.

Those working in the gig economy do not enjoy the same rights and protections as employed workers, such as health benefits, overtime pay and sick leave pay.

The TUC has highlighted that the increase in self-employment has not been driven by a boom in entrepreneurship but, instead, workers are increasingly forced by employers to accept precarious employment with low pay.

Deliveroo has recently come under fire from workers over their employment practices in relation to the minimum wage. And Uber is involved in an employment tribunal where drivers have contested their status as self-employed, suggesting they should be entitled to a range of benefits such as pension contributions as well as holiday and sick pay.

In a bid to address concerns about the lack of rights held by people working in the gig economy, Theresa May has recently appointed a former adviser of Tony Blair to head a review into employment rights across the new economy.

But this will be no easy feat, as the rapid development of the gig economy poses significant challenges for policy makers and regulators to keep up.

Final thoughts

As the McKinsey report argues, “expanding economic opportunities and income security policies for this group should be a priority”. Hopefully the review of employment rights will mark the first step in the right direction.

If you enjoyed reading this, you may also be interested in our previous blog on ‘the self-employment boom‘.

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