Americans love the sharing economy. Just look at the rapidly growing popularity of companies such as Airbnb, Lyft and Thumbtack. Though first adopted by tech-savvy urbanites, millions of people now use these services, either as consumers or workers.
But why is the sharing economy — something that Americans, especially millennials, so enthusiastically embrace — coming under continued political fire? The answer is that new technology necessitates change, and some established interests want to avoid change at all costs.
The “platform” technologies that define the sharing economy connect people and enable shared access to resources. Though Uber is constantly in the news, the sharing economy extends far beyond a few well-known apps. Internet platforms help everyone from interior designers and personal trainers to handymen and coders find people who want their services.
Because of increased connectivity, working as an independent contractor is gaining popularity. With the costs of finding and vetting someone now so low, fewer workers need to rely on a single full-time employer to make ends meet. In other words, the technology that drives the sharing economy makes it easier for customers to directly work with service providers and for people to work without a boss.
Opposition to these individualized work arrangements arises because, unlike employees, independent contractors cannot be represented by unions through collective bargaining. This poses a threat to labor unions, which are already facing dwindling membership rolls. Rather than adapt to the changing workforce, unions are digging in their heels and calling in favors to their political allies.
The Teamsters Union even wrote, “Don’t the let the term ‘sharing economy’ fool you. There is no sharing. It’s really just the 1 percent making money by stripping workers of the rights for which the labor movement has fought so hard to secure.”
Following on this theme, New York City Mayor Bill de Blasio said that companies such as Uber come into the city and fight his “progressive values.” And last month, Sen. Elizabeth Warren, D-Mass., argued that sharing-economy companies rely on “extremely low wages” to perpetuate a system where “all the benefits are floating to the top 10 percent.”
All of this is nonsense. To the contrary, by lowering costs and extending consumer options, the sharing economy creates services that are truly for the “99 percent.” For example, just take Uber in New York City, the subject of my new monograph “Uber-Positive: Why Americans Love the Sharing Economy.”
Before Uber’s rise, it was nearly impossible to find a taxi in New York City’s lower-income, outer-borough neighborhoods. While iconic yellow taxis were all over business districts in downtown and midtown Manhattan, government-imposed limits on the number of taxis left millions of New Yorkers underserved by the system.
But Uber is a technology company, so it was not constrained by New York City’s 1930s-era regulations on transportation companies. Because of this freedom, as Uber grew, its reach increased at the fastest rate in the lower-income, outer-borough neighborhoods. These are the places that needed additional transportation options the most.
Just a few years ago, the costs of having a private driver were too expensive for even upper middle-class Americans. Now, Uber and other ridesharing services have transformed what used to be a luxury into an everyday experience. This is the sharing economy at work, and politicians would be wise to embrace these truly progressive results.
Simply put, Americans love the sharing economy — and politicians should, too. No matter how badly labor unions and their friends in power want to paint the sharing economy as elitist, this picture is pure fantasy. The true elitists are those politicians who are working to take away innovative services that increase consumer and worker choice.