The explosion of startups such as Uber and TaskRabbit is creating a new army of workers, many of them from the Millennial generation, who cobble together freelance gigs and contract work to earn a living — and that is raising new questions for policymakers.
“This next generation, where they are in the ‘sharing economy,’ the Millennials, 80 million strong, they have no safety net at all: no unemployment, no workman’s comp, no disability,” Sen. Mark Warner, D-Va., told Capital Download. “Somebody may be doing very, very well as an Etsy seller and Airbnb user and Uber driver and part-time consultant … but if they hit a rough patch, they have nothing to stop them until they fall, frankly, back upon government assistance programs.”
Warner, who earned a fortune as a tech entrepreneur before entering politics, hopes to spark a debate in Washington and among the 2016 presidential contenders about how to respond to the complications of the new American workforce. He discussed his ideas on USA TODAY’s weekly video newsmaker series Wednesday and is slated to deliver a speech about it at the New America Foundation on Thursday morning.
Two possible approaches: An “hour bank,” modeled on a program used by some building trades, that tracks a worker’s hours for a variety of employers and collects and administers training and retirement programs. Or an “opt-in” that gives consumers the option of adding a nominal amount to their payment that would go to a benefits fund for workers.
The health care exchanges established through the Affordable Care Act also could provide a model for workers who aren’t covered by disability, retirement and other benefits through their jobs to get them through a public-private initiative.
“We are not going to slow globalization down,” Warner says. “We’re not going to slow this disaggregation between employer and employee down. So we’ve got to figure out ways to make it work for people better.”
The workers now operating in a ‘gig economy’ includes professionals who were laid off mid-career and have had trouble finding full-time work as well as low-income workers long accustomed to working several jobs. While there’s not much government data to draw on, the biggest group seems to be millennials who have joined the workforce in the wake of the Great Recession.
“This whole generation is more willing to see disruptive change; that’s good news,” Warner says. “They’re more tolerant; that’s good news. They’re not as prejudiced. So all those are good things. But they clearly don’t have an expectation they’re going to work in one firm forever. They think they’re going to cobble together a series of different opportunities.”
Those attitudes are reflected in Warner’s three daughters, all in their 20s. When you meet people in that generation, he says, the opening question “is not ‘where (do) you work?’ It’s ‘what are you working on now?'”
Warner, 60, served one term as governor before twice being elected to the Senate in Virginia, now a swing state in presidential politics. One of just 13 Senate Democrats who backed the Trade Promotion Authority bill backed by President Obama, he warns Democrats from being pulled to the left on economic issues.
Hillary Clinton has “got a fine line to walk here,” he said. (He endorsed her last fall.) “I think it’s a healthy debate, but I do think at the end of the day you win states like Virginia by appealing to the middle.”