Meeting up with some friends? Will you bike, transit, taxi or Uber there? In just over a decade, Uber has become a verb, and that cultural ubiquity signals a major shift in not only how people move through the world, but also how they work in it. As a rapidly growing for-profit venture with global reach, the ride-hailing app Uber has profoundly changed the labour market, influenced public policy and become a model for other ride-hailing apps. Along with the short-term rental website Airbnb, Uber is one of the most visible examples of the digital platform economy. It’s a burgeoning field of interest among Canadian researchers and academics, and one that’s come with significant research challenges.
While the “gig economy” is defined by short-term, precarious work and the “sharing economy” speaks to the ways in which services or resources are shared between individuals, the “digital platform economy” is distinct from these two (though often related) for its use of centralized technology, often an app, that matches users to underutilized resources like labour or capital, explains Shauna Brail, an associate professor at the University of Toronto’s urban studies program. “The interesting thing about these very large, quickly growing digital platform economy firms is that they tend not to own or have ownership of any physical goods,” Dr. Brail notes. It’s this lack of ownership that has been integral to why these companies have scaled up so quickly, she adds. And not directly providing any labour or capital of their own has also allowed companies like Uber to position themselves as a matchmaking service, rather than an employer of thousands – one of the major tensions underlying this new economy.
By defining themselves as a connector and not an employer, Uber is able to skirt labour laws that would force them to pay their drivers vacation or sick pay, unemployment insurance, car maintenance fees, or to offer any benefits. Drivers across the globe are trying to organize in response, a movement that Arvind Magesan, an associate professor of economics at the University of Calgary, has been following very closely. He wrote about Uber drivers’ planned “National Day of Action” this past May for The Conversation.
Dr. Magesan says that, on paper, work in the digital platform economy is very attractive. However, despite the flexibility of the job, which allows drivers to supplement other income or to act as a main source of income, they face many issues. “Firms have, so far, not allowed for
workers to organize in any meaningful way,” he explains. “Third parties have stepped in to coordinate labour action for workers, but it’s not clear how effective this will be.”
A recent bill signed in California could spark the beginnings of a change. Coming into effect in 2020, the bill mandates that app-based companies such as Uber or Lyft treat their drivers like employees and not users or contractors. The bill states that for a worker to be considered an “independent contractor” they must be “free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact,” which correlates to the control Uber exerts over its drivers, according to PhD candidate Nura Jabagi. “Workers are constantly supervised on the platform,” says the business-technology management researcher at Concordia University. “Their driving is moni-tored, how often they’re braking – everything is monitored. [The app] sends little nudges saying, ‘Do 10 more drives and you’ll meet this threshold.’”
A recent recipient of Concordia’s Stand-Out Graduate Research Award, Ms. Jabagi’s research is concerned with the app’s algorithm and how it manages drivers, particularly in terms of how it motivates and supports them. “I’m looking at how people perceive algorithmic decisions that are made on the platform, and because the algorithm makes a lot of decisions, how much autonomy workers really have,” she says. Her work will look at Uber through the lens of workers’ perceived organizational support, a theory she says hasn’t been applied to algorithmic management before. Ms. Jabagi’s hope is that her research can help create managerial algorithms that are perceived as fair, as well as an app that gives drivers more autonomy and therefore more fulfillment in their work. “How can we build platforms that humanize the experience to help workers feel genuinely motivated and supported?”
The decision in California is also noteworthy because the new legislative frameworks being developed in response to the digital platform economy have largely been driven by cities. “[Digital platforms] have a massive impact on governance,” explains Dr. Brail. She points to a recent study from McGill University that suggested over 31,000 units were taken out of the Canadian rental market thanks to short-term rental companies like Airbnb, as an example of how this new economy affects the characteristics and structure of urbanized areas. “Local and other governments are managing the emergence of new industries and sectors whose activities weren’t necessarily contemplated in previous rounds of regulation, and who are fitting into what’s being considered a grey area and really require some oversight.” Dr. Brail’s recent work looks at how the operation and expansion of ride-hailing is being dealt with in Toronto, the impacts of those decisions and how they extend beyond the digital platform economy.
The challenge now for these academics is data. Though they collect and store massive amounts of user data, companies like Uber are extremely protective of that information. “Labour economists have been studying wages for as long as the field has been around,” explains Dr. Magesan. “We don’t have the same data for these workers to see what factors cause wage loss or unemployment. Until we have that data at the worker level, it’s going to be hard to answer questions from a policy perspective to help them out.”
Dr. Brail says that Statistics Canada did a survey in 2016 looking at the digital platform economy, the results of which she says are now quite out of date. To move forward in their re-search, she and Ms. Jabagi are developing their own datasets: Dr. Brail is currently mapping the economic geography of ride-hailing firms globally, while Ms. Jabagi is developing survey instruments that will allow her to measure perceptions of algorithmic fairness and support for autonomy within these digital organizations. “A lot of these processes of algorithmic management are being brought into traditional organizations,” Ms. Jabagi says. “So there’s still a lot to learn.”