The Real Gig Economy: Sarah Kessler, Author of Gigged

[01:39] Paul: Today I'm talking with Sarah Kessler, who's the deputy editor at Quartz at Work and also one of the first people that was actually writing about the gig economy before it was called as such. She's also written a book called Gigged, which I thought was a really great deep dive into the human side of the gig economy. And excited to talk to you today, Sarah.

[02:09] Sarah Kessler: Thank you. Happy to be here.

[02:11] Paul: So you share in the foreword of your book that although you grew up in what might be kind of a traditional background in rural Wisconsin, you said at least in terms of relative to your peers, you didn't expect kind of the, the path you might take to be ordered. Was this driven by kind of a choice of becoming a journalist, or was just this just the— your mindset towards the world?

[02:37] Sarah Kessler: Um, I guess, uh, more of a product of my generation, what was happening at the time when I was graduating college, um, which is kind of right as the economy was recovering after the recession. Um, it just didn't seem like everybody was guaranteed a full-time job. It didn't seem like everybody was working at the same company for 50 years.

[03:06] Paul: Yeah, it seems like some of these things around the gig economy are very natural for some areas. I think if you think of someone like an actor, they've been gig workers forever, and even journalists. When you talk to people, was there a sense that there was even that big of a shift, or was it just different mediums and pay models that people were thinking about?

[03:34] Sarah Kessler: Yeah, I think overall in the economy there's been a shift over, you know, maybe since the '70s of companies outsourcing more and more of their work. And that's not all freelance, that's also kind of hiring contractors. You know, your janitor used to be work at Kodak and now they're probably provided by another company that focuses on janitorial services and doesn't work for Facebook or work for Google. There's temp work, there's all sorts of variations of kind of people who do work for a company but don't actually work there. And that's kind of this like long trend. What I was looking at was how technology kind of changes that or this little group of companies that called themselves the gig economy.

It's almost like a turbocharged version of this and kind of demonstrates how far it's possible to push outsourcing work, how small that you can make the tasks, how much control you can really have using this mobile technology.

[04:43] Paul: Yeah, it's interesting. I mean, we had books like The World Is Flat from Thomas Friedman in 2001 talking about how all this was great, we're outsourcing things to India. It's good wage for them, it's good for US companies, and then it kind of is happening in the US now, except we're creating all these jobs. I think like you said, the janitorial type jobs where they, in a lot of cases, these wages are worse. It's worse for people, and sometimes it's even worse for the people that are employing them. Uh, maybe you can talk a little bit about that.

Maybe they're like the hidden side of the future of work that people don't talk about?

[05:23] Sarah Kessler: Yeah, well, the problem of kind of using more and more freelancers is that our whole system is set up for this idea of an employee working a full-time job. So, you know, all of our labor protections, all of our benefits programs are set up for employees. So if you have more people who aren't working as employees, doing some sort of freelancing, you have more people kind of living without those protections and the social safety net.

[05:56] Paul: Yeah, it's, it's kind of crazy too. I think we're so tied to this idea of full-time work. I was doing some research earlier this year, and if you just look at Americans, like not even counting just the people working, it's only 37% of people that have these full-time wage jobs. And that may not even include people with all those benefits we talk about. So in some ways we're almost pretending like this state of work still exists, but really it only exists for a smaller and even shrinking amount of people. Have you seen people talking about that?

[06:34] Sarah Kessler: I mean, it also depends on how you count, right? So there are a lot of different estimates with of how many people do freelancing, and it varies a lot depending on whether you're counting, do you do any freelancing, or is this your full-time kind of main job? Which, if you're going to ask that question, relies on someone having an idea of a main job, right? And so you get lots of different estimates, but I think most of the data shows that this kind of work is increasing in some sort of, in some capacity. And even if kind of a lot of people are doing this in addition to a traditional job, it kind of casts some doubt on how, on the quality of kind of that traditional job. Like if you can't make ends meet by working, you know, a full-time job, which used to be a whole package that's also, you know, kind of something that's changed.

[07:37] Paul: Right. So what, what eventually drew you to say, okay, maybe there's a book here? I know you talked about you were having conversations with different people. Um, you, I think you said you had 9 people. Um, but what, what were the themes across these that started to make you think, okay, maybe there's a book here?

[07:58] Sarah Kessler: Um, So, um, uh, so I've been kind of in this space for a long time because I was a startup reporter. And when kind of Silicon Valley, um, started making its version of this, which was kind of the Uber-type app, which again, like, this is a trend that's been happening for a long time, but they invented kind of this new version of it that they were presenting as something new and wonderful.

[08:26] Paul: Um, right.

[08:27] Sarah Kessler: And I was right kind of in the center of, you know, I was the person they were trying to persuade of this narrative. And so I was covering kind of like the business side of it. And at some point, just the how it actually impacted kind of the workers that were buying into this idea started becoming more interesting. And I think what makes it a book is that that's not You know, the story of Silicon Valley and its idea of what it could do with the gig economy is kind of a small section of the world, but it ties into these bigger trends of how work has kind of become more fractured and how risk has shifted to workers. And so there's a lot to talk about in terms of how this kind of little microcosm fits into the bigger world.

[09:24] Paul: Yeah, it's, it's been fascinating. I thought it was pretty cool how you shared the story of Uber getting $238 million and everyone was just shocked. And now they're talking about this company being valued at, I think, more than 500 times that, at $120 billion or something. But again, when you look at this, it's actually a small amount of workers who are working for Uber. And what these platforms have seemed to do is just take an enormous amount of wealth and create them in these, in these companies that are using contractors.

[10:01] Sarah Kessler: Yeah. And I think it's also like Uber is kind of an extreme version of this thing that's happening all over the place. Right. And it's talked about because it's such an anomaly in terms of its valuation and its impact in the business world. So we talk about it, but kind of the same issues you can find at any— at like your— the most non-Silicon Valley company that you might think of. You know, you work for a staffing firm, so you probably have seen a lot of examples of that.

[10:37] Paul: Yeah. I mean, on my side, I've worked for all these talent platforms and it's been interesting to watch because with their whole motivation is to build the biggest platform, right? And the incentives aren't really aligned to value the freelancer. Now, it works for the freelancer as long as the platform's increasing and you can make a, a living off the platform, but they increasingly try to automate everything, right? So you actually have no human interaction. Which sets up this really weird dynamic of getting work through a robot.

And you're like, okay, why is this platform here then? It's, it's, it's been fascinating to watch. I don't know how it will end up. I just, I just think the next evolution of it has to be a little more human.

[11:29] Sarah Kessler: Yeah, you can really, you know, there are like these models of how kind of work can automatically be managed by technology, to which point you're like kind of breaking it into these really small tasks and having kind of the human, I don't know, like press the button and then.

[11:52] Paul: Right.

[11:53] Sarah Kessler: So there's this kind of like dark, if you extrapolate that and be like, oh, we could do that with so many jobs. You know, we could take this model that these academics have developed where the AI builds like an entire, you know, cell phone app in a day by going out and automatically hiring freelancers to check the work of other freelancers. So like, you make this widget and then we'll take it over here and this person does this next. It almost like sets up a digital assembly line. And so this kind of complicated work that you thought about could actually be like completed by this mob of people doing small tasks.

[12:40] Paul: Right.

[12:42] Sarah Kessler: And that can get dark if you think about it.

[12:45] Paul: Well, and that's the thing you talk about in the book. You're saying, okay, all these companies are talking about AI, but it's actually just humans hitting the button. And you have an amazing quote from Christie Milland And she basically is just like, I am a human, not an algorithm, which pretty much sums this up. Maybe you can share a little bit more about Christie, who I think was one of the stars of your book.

[13:11] Sarah Kessler: Sure. So Christie works— or so she, she started working on Amazon Mechanical Turk, which, if you're not familiar with it, is this platform kind of created by Amazon where companies can post a lot of small tasks that they have in high volume, and then kind of thousands of people can complete them. And usually they get paid 5 cents or 3 cents, whatever, per task. So an example might be if you have an e-commerce site with 1,000 products on it, you might post a task in Mechanical Turk. Every description that you write for a product, you can have 5 cents, and somebody will go through and they'll do a ton of these. And so Christie, her husband lost his job in manufacturing.

And so she was faced with kind of having to make more money quickly. And, you know, didn't really have a lot of experience working out of the house. But she knew she could log on this website, she could make money. So and she did, and she made $40,000 a year, 5 cents at a time, which is kind of crazy when you think about it. And, but the way that she did it was she had to kind of like create all of these crazy systems. Like if there was a good task, she set up a bot that would check if she was qualified for it.

And if she was, like an alarm would go off on her computer and she would run and like claim it as quickly as she could. Wow. Sleep in her office in case the alarm went off. Um, and, you know, kind of all these crazy workarounds. Um, and it took a bit of a toll. Like, you know, she's sleeping in her office.

Yeah, developing all these injuries in her wrist and elbow, which she couldn't, you know, take off to take care of because there's no sick days. Um, she couldn't afford the medication to get, you know, the surgeries that she needed, and there's no workers' compensation. So you kind got in a situation where you're glad that she could make it work, maybe that's a good thing, but you can't really feel too good about the work that was created and the humanity of it. I think it seems like we could do better.

[15:41] Paul: Yeah. And she, she was kind of building a following online around some of this work as well. Have they made any progress in terms of getting Amazon to offer any more here?

[15:54] Sarah Kessler: Not really. So she was involved in this kind of platform that she and researchers at Stanford were building that would allow kind of Mechanical Turk workers to organize campaigns. And so they did things like write letters to Jeff Bezos requesting changes, and they made a like policy guidelines for researchers who do research on the platform, because a lot of times academics post surveys and stuff like that because it's an easy population to access instead of like having grad students recruiting them from campus or whatever else you do when you have an academic study. And so they did that, but largely It's really hard to organize if you're working this way because one, you have no federally protected right to organize. Right. And then two, kind of your coworkers, you don't know who they are.

You don't know where they are. They might be very different than you. For instance, they might work in the Philippines and you might work in Canada and you both are like, yeah, let's have a minimum wage. But your idea about what wage should be is very different. There's a lot of barriers to organizing in the gig economy.

[17:19] Paul: Another misconception you highlighted was people want flexibility, right? And this is touted as people want to be in this, but they are never asked the second question of saying, are you okay with flexibility if you earn less? Maybe you could talk about some of the research there and some of the misleading information.

[17:42] Sarah Kessler: Yeah, so basically there are all these surveys that ask millennials in particular, like, do you like flexibility?

[17:50] Paul: Who's gonna say no to that?

[17:52] Sarah Kessler: Yeah, of course, sure. But what they don't ask is, what are you willing to give up for flexibility? So would you get paid less? Would you have no benefits? Would you— and there were There was a group of researchers, I believe from Princeton, that set up an experiment where they did actually look to assess kind of how people valued flexibility, which means kind of what were they willing to give up to get it. So they had— they posted a bunch of jobs at different rates and had people choose kind of like, if you had flexibility, you would make this much, and if you had no flexibility, you'd make more or vice versa.

And basically they found people aren't willing to give up a whole lot to have a flexible schedule, which is interesting because it is a trade-off often when you're talking about working in the gig economy. You know, you don't have any benefits, you have a lot of insecurity and volatility. You don't know how much you're gonna make next week often. So I just think kind of the focus on flexibility has been a little bit of a dodge. And if you ask any company, any gig economy company, basically any question, like literally anything, you're like, oh, how'd you do last quarter? They're just going to say, we love giving people flexibility.

That's the only thing they will say.

[19:31] Paul: That's so good. They all have the same PR person, maybe.

[19:34] Sarah Kessler: It's possible.

[19:37] Paul: It's a, it's an interesting question because I don't, I don't think people are going to that second level because, and I have conversations with people all the time. I've, I've actually actively said I, I'm okay with making a lot less than I used to make. And the trade-offs for me are the flexibility. I'm totally comfortable with that. But it was a process because what I realized in making that shift is that we and so many people attach self-worth, meaning, dignity to like how much you make. And you can easily make the argument that that shouldn't be the case, but it's today's reality in a lot of work people are doing.

[20:20] Sarah Kessler: Yeah, I also think it's a little different than for, you know, kind of creative professional work than it is for somebody who's like trying, who's living kind of paycheck to paycheck and maybe working close to the minimum wage. You know, if, if I were to quit my job and become a freelancer, I would be able to buy my own health insurance. I have enough savings where if I didn't, if I had a bad week, you know, I'd still be able to buy groceries. But for a lot of people in a lot of jobs that kind of gig economy companies have found ways to make freelance, you know, that's not the case. If, you know, they aren't provided health insurance by their employer, they don't have it. If they don't make as much money next week as they thought that they would, they aren't gonna buy groceries or they're not gonna pay their water bill.

And so it's just a little bit of a different reality. And I think a lot of times like companies like Uber, they talk about their work as though it is being a freelance graphic designer or something like that. And it's not the same thing.

[21:35] Paul: Yeah, it's, it also doesn't provide, I mean, if you become the world's best Uber driver, you're still getting the Uber rate, right? And in fact, Uber might figure out how to even lower that rate further rather than you're not going to get better at something like you might at graphic design and get more clients or build more stability over time.

[21:59] Sarah Kessler: Yeah, exactly. You're not really building a business that you can benefit from doing your good work or building a brand. Yeah.

[22:06] Paul: And I, I think I see, I mean, going back to these gig platforms, everyone is saying it's so much opportunity for people and it's almost touted out as, okay, all these people are going to lose these jobs, but more people will become giggers. And I'm like, okay, what are they talking about? It's basically just, we're gonna eliminate people's benefits and they're just gonna have to figure things out on their own. I think you wrote something about this, um, in the South in the US, how that's, that's been changing down there.

[22:43] Sarah Kessler: Yeah, in the book I followed a nonprofit that tried to use kind of this gig economy idea of, you know, opportunity is everywhere now, you just need to log into these, you know, to Upwork and you can find it. They tried to actually use that to help people who were living in poverty find work. And so they kind of set up classes where they taught people how to use Upwork. And it didn't work at all. The instructor said he knew it wasn't gonna work on the first day of class. It became pretty quickly apparent.

And the problem is 'cause, is that kind of, you know, Upwork is not, it's not gonna lift people out of poverty. The problem is not that there's no way to log in and find these freelance jobs. It's that the education system is broken. It's that, slavery happened and a lot of people started at a huge disadvantage with a lot of trauma. The problem is that people can't pay their water bills. And so it's really hard to, you know, keep pitching people your graphic design skills over and over again and have a very small success rate when you're not getting paid at all for the work that you're doing pitching.

So it was just kind of an ignorant approach.

[24:03] Paul: Yeah. I, I will say even myself, I signed up for Upwork a couple years ago. I've probably pitched in a bunch of projects here and there. I've never won one. I honestly have no idea how to actually get work on Upwork. Um, so even for somebody that kind of knows what they're doing and has, uh, some of the skills, it's still kind of a black box.

And I, I wonder if part of the problem is I think it might have been really great for early people that adopted it, but they just haven't increased the number of opportunities coming on the supply side. So I don't know, it'll be interesting to see how these evolve over the next few years.

[24:43] Sarah Kessler: Yeah, definitely.

[24:47] Paul: So as a, as part of your experiments, you talked about about some of the gigs you actually did. I mean, you've definitely been writing, that in ways can be a gig, but you participated in a flash mob. One of my first gigs was holding a sign in New York where I was trying to find people wearing Allbirds so I could ask them a 4-question survey. Were there any other interesting gigs you've heard about or ones you've experienced?

[25:24] Sarah Kessler: Yeah, so that was for a magazine article in 2013 when people were still, when kind of like the narrative was still like, this is gonna solve unemployment, this opportunity. I signed up for all of the platforms, like 30 of them, and then tried to make the minimum wage kind of with my best efforts at making a living on them. Yeah, there were a lot of crazy things. TaskRabbit was where I had most success. And I, you know, at the time it was a little bit different. Like you, anybody posted something and then you bid on it.

And you were like, I can do this for $15. And this is why I'm the best person. And I quickly learned you had to bid on everything. And you had to bid really low. And so there was everything from like, come clean toilets, So like, oh my God, deliver this gag gift. I dissolved someone's LLC.

[26:24] Paul: Wow.

[26:26] Sarah Kessler: Yeah, I like met them at the Harvard Club and then just spent a lot of time on the phone with the state, like Delaware bureaucracy. Yeah, there's just like really everything under the sun. Wow. There's like a startup for waiting in line, I think, that uses this model. Like you could just go be a professional line waiter.

[26:50] Paul: So, in this book, so I mean, we've talked about some of the downsides of the gig economy. Maybe we can shift to some of the better examples like Managed by Q. I think some of the backlash from the gig economy has made people realize, like the founder of Managed by Q, that maybe this isn't the best idea and you can actually run a company more successfully if you do full-time employees and give and treat people like they're part of something. So maybe you can highlight that story briefly.

[27:25] Sarah Kessler: Yeah, so the idea is, which, so in Manage My Q's case, kind of this theory was based on research by a professor you know at MIT Sloan, Zeynep Tunc, and basically she looks at companies like Costco Costco and Trader Joe's and QuickTrip, you know, these not kind of mine, you know, these companies that are not very like minor and they're very successful and kind of showed how they succeed by treating their employees well. And her idea is not that you automatically succeed by paying people more and giving them benefits, but that you can leverage the advantages that you get by doing that. And that can be a way to succeed if you choose it. You don't have to exploit people to succeed, which is kind of the message that you get a lot in business, like, oh, we can't possibly compete if we were to do that. And she has all these examples of how you can.

And so Managed by Q is building a cleaning business, and they decided to hire their cleaners and kind of give them full health benefits and equity in the company. And all these, and training opportunities and all these things that you wouldn't get in a gig economy version of that. And they successfully kind of scaled a decent size cleaning company that way. I don't know that it's one that venture capitalists are super interested in. I think that they were more interested in the software that they were building and like the market of offices that they were serving. But it was like a sustainable, profitable business.

[29:18] Paul: Yeah, it's, uh, they're doing some good work. Shout out to, uh, Sarah Kalik, who's helping ZenUp with that, if she's listening. But, um, I think the big shift they push people to make is don't just look at wage as a cost, right? These are actual people, and a lot of your story brings that alive. And people means these are people that can learn, they can do creative things, they imagine. They can do incredible things if you just kind of create the operating conditions for them to thrive.

So it's, perhaps it's almost like the next generation, hopefully, of the reaction to the gig economy and people seeing more value in how you can bring labor into your organization to succeed.

[30:11] Sarah Kessler: Yeah, hopefully.

[30:13] Paul: And where, where do you see things headed? Like, what are you thinking about in terms of your writing and how you're seeing the gig economy evolve over the next few years?

[30:26] Sarah Kessler: I think it'll be interesting to see more companies adapt, like, Uber-type models to whatever they're doing outside of Silicon Valley. Like what these other industries have learned from the quote unquote gig economy. I think you're already seeing it with like staffing firms that basically lease employees to companies. A lot of them have Uber-like methods of providing people quickly now. You're seeing kind of the restaurant industry and hotel industry also come up with these apps. So I think it'll continue to infiltrate places where it's not as fun to talk about as Uber.

[31:14] Paul: Have you seen any promising movements around things like portable benefits and other ideas that have been tossed around? I know a couple senators in the US are working on this and a couple— I know the Aspen Institute is doing some experiments, but Have you seen anything that seems to have any legs?

[31:33] Sarah Kessler: Yeah, portable benefits is a really good idea and just a pretty simple one. Like, your, your, your benefits, your social safety net should not be attached to your employment status. It should be independent from it. The problem is, is that a lot of people can agree that that's a good idea. But when it comes to the details, it's really contentious. So like, yeah, yeah, portable benefits.

And it's like, what do you mean by portable benefits? Oh, I mean, everybody's guaranteed to a $15 minimum wage and full healthcare provided by, you know, whatever. And then you're like, oh, okay, what do you mean by portable benefits? And it's like, well, I was thinking that instead of hiring employees, you would just let me classify them as independent contractors and I'll pay 2% of the wages to this fund and fund their own sick days. And that's portable benefits. Reaching agreement is going to be hard.

And I think kind of any way that it starts is going to be at the state level with experiments. And so we'll see.

[32:41] Paul: Yeah, it's interesting how quickly things are becoming political too. And another challenge is a lot of people with good benefits and full-time jobs don't actually want to give up any of those benefits. So there's not much of a fervor for change.

[32:58] Sarah Kessler: Yeah.

[33:00] Paul: Um, what, what are you thinking about just in terms of the human side of work? And I mean, there's so much writing about the future of work, and I think a lot of it is so disconnected from what's actually happening. But what do you wish people knew more about the future of work, or at least covered more in the media?

[33:21] Sarah Kessler: Um, I think that there's a lot to focus on in the present of work. And so some of the discussion is like the future of work conversation is almost uninteresting. It's like there's people who will argue like, oh, robots are going to take over all the work. And then there's other people who will argue robots are going to just make us more human. But those are really the only two stances people have, right? Because the future and we don't know what's going to happen.

So there's limited interesting things to say about it. So I guess I would like to focus more on the present of work.

[33:57] Paul: Yeah, that's great. Any, any final words or places you want to direct people to learn more about some of your writing?

[34:08] Sarah Kessler: I'd love if they would read my book, Gigged. And that, yeah, that is That is the main thing. There's also— I also work at Quartz at Work, which is a really good website about just the workplace in general and not kind of specific to this issue. And we cover everything from like the little anxieties of work to like the big picture kind of structure of capitalism. So I definitely check that out too.

[34:41] Paul: Awesome. Well, thank you so much, Sarah. I really enjoyed diving into the book today.

[34:46] Sarah Kessler: Yeah, thank you, Paul.