Low-Wage Work

One of the initiatives California voters are deciding this fall is Proposition 22. This initiative carves out an exception from state labor law for app-based transportation and delivery gig companies, including Uber, Lyft, DoorDash, and Instacart, allowing the companies to continue to classify their workers as independent contractors rather than employees. Labor Center chair Ken Jacobs along with Michael Reich, economics professor and co-chair of the Center on Wage and Employment Dynamics, have produced several papers that examine the implications of Prop 22 compared to employee status for drivers, consumers, taxpayers, and the companies.

In this report, we focus on trends in technology adoption in the retail sector, looking beyond the effects of the current crisis to trace how retailers are using digital technologies in ways that alter the quality and quantity of front-line retail jobs. While we recognize the pandemic’s possible impacts on the retail workplace throughout the report, the bulk of our discussion concerns longstanding trends that appear likely to continue over the next five years or longer.

New technologies in the retail sector are likely to mean more monitoring and coercion of workers, and a stronger advantage for large companies like Walmart and Amazon, according to a new report released today from the U.C. Berkeley Labor Center and Working Partnerships USA.

Thornberg over-estimates driver gross earnings (before expenses) based on data that is not representative of drivers in California. He also underestimates driver costs. In doing so, he significantly overstates what drivers earn on net now, and would earn under Proposition 22.

The COVID-19 crisis that hit the world and the United States has resulted in profound changes to our way of life. While this paper focuses on workers and economic effects, we note that the crisis is foremost one of a pandemic. The economic situation is a byproduct. Public policy and investment will largely determine our rates of sickness, death and economic pain.