Technology is changing many aspects of our lives and there is a long list of negative effects. Artificial intelligence tends to push humans to the fringes where jobs are much less rewarding. Platform work is usually associated with exploitative patterns and a lack of social security. Algorithms in general have been found to contribute to racial and gender discrimination. Cathy O’Neil even called them “Weapons of Math Destruction”. Understandably, there is widespread resistance to new technologies.
However, it is also worth looking at the positive aspects of technology on local entrepreneurship and employment.
Entrepreneurship
Bill Burnett and Dave Evans have written a manual on how to apply design thinking principles to your own life. [1] One major aspect is “prototyping”. For entrepreneurs it means that it is recommendable to try out new ideas before betting your life savings on it.
Digital platforms offer many of these prototyping opportunities. It is relatively easy to sell products online (Amazon), rent apartments to tourists (AirBnB), design graphics (99 Design), podcast or influence (YouTube), write newsletters (Substack) or do any other work (Amazon Turk, Foodora, Comatch or Task Rabbit).
The scale of activities is significant. Take the example of Thrasio. It has raised $1.7 billion so far to acquire smaller retailers on Amazon. It gives an indication of how large this entrepreneurial ecosystem is. It still remains to be seen what will happen with all these “Amazon entrepreneurs” or “AirBnB entrepreneurs” but it would be a mistake to disregard this wave of entrepreneurial activity.
Employment
It is hard to find global numbers how platforms contribute to employment. A few numbers might help to illustrate the scale of the industry. Uber has almost 3.9 million drivers. The translation platform Lionbridge has more than 500,000 registered translators on their platform. Freelance platforms usually have a few hundred thousand to a few million registered freelancers.
These platforms are also usually a transitionary part of the labour market. For example, Cook and colleagues (2018) find that 68% of all Uber drivers are no longer active 26 weeks after their first trip. [2] This ties well with anecdotal evidence which perceives platform work as entry-level or transitionary jobs.
Overall, the lack of social security and some of the practices are troubling but there should also be positive effects. For example, platforms increase the options for employees over a business cycle which might force employers to make more competitive offers.
Conclusion
It seems that there is a narrow corridor on how to balance emerging new technologies with human expectations. There are plenty of opportunities for entrepreneurs and employees but also a certain risk of labour standards erosion and less rewarding work environments.
[1] Burnett, William, Bill Burnett, and David John Evans. Designing your life: How to build a well-lived, joyful life. Knopf, 2016.
[2] Cook, Cody, et al. The gender earnings gap in the gig economy: Evidence from over a million rideshare drivers. No. w24732. National Bureau of Economic Research, 2018.
