Uber, Mall Santas and the Gig Economy

Instead of firing up the sleigh and making the gift delivery rounds this year, Santa is outsourcing the job to a fleet of Uber-driving Mall Santa independent contractors.

Rather than sleeping in beds with sugar plums dancing in their heads, children across the world will be "checking the app" to see the estimated arrival time of their beautifully wrapped drones and 3D printers.

You can also forget about the tradition of leaving milk and cookies for Santa- this year you can leave things like healthcare benefits or the right to collectively bargain for those independent Santas.

Technology has transformed the world of work. We have new products and services - and new jobs to deliver those products and services - that didn't exist only a few years ago. We have new words like hyperlocal job markets, digital citizenship, human neurodiversity and the gig economy. We also have new kinds of relationships between "employees" and "employers."

The rise of the gig economy does not signal the death of "old fashioned" firms with conventional employee-employer relationships. After all, Mall Santas, moonlighters and people working at other gig-type arrangements have been around for a very long time. But what the rise of the gig economy does signal is the need to think about why workers choose those arrangements, and what "old fashioned" firms can learn from companies like Uber. Here are my key takeaways:

• Workers care about autonomy. According to an Uber survey, 87% of respondents said a major reason for working with Uber is "to be my own boss and set my own schedule." While not everyone can be a boss, there are other ways for "old fashioned" firms to satisfy employees' need for autonomy. Proper job design, appropriate decision authority and well structured pay for performance systems can go a long way in providing employees with the autonomy they crave.
• Workers care about flexibility. 85% of survey respondents said a major reason for working with Uber was "to have more flexibility in my schedule and balance my work with my life and family." We all know that workplace flexibility is important, but we don't always do a great job of providing it for our employees. Think creatively about flexibility - blend telecommuting, flexible working hours, flexible leave arrangements, job sharing, and job mobility in the right mix for your workforce. For a more radical transformation, you could consider implementing a ROWE (Results Only Work Environment) strategy.
• Workers care about money. 91% of survey respondents said a major reason for working with Uber was "to earn more income to better support myself or my family." It's no secret that compensation budgets have been and continue to be tight. The reality for most employees is that their earnings are not at a level sufficient to take money off the table. Even though we may want to pay more, we may not be financially able to pay more. Pay for performance strategies can be very effective in addressing this. Increasing the variable portion of total compensation can better align payroll obligations with the organization's ability to pay. Also keep in mind that the concern about money ultimately relates to quality of life issues. There may be opportunities to improve the quality of life for your employees and their families through non-financial channels. In some cases, these opportunities may be related to workplace flexibility - be creative and think about ways to create synergy. 

Technology has unquestioningly changed the world of work. There is still a place for "old fashioned" firms, just not old fashioned thinking. Click on through to Fiverr and see what kinds of new ideas you can find! 

Stephanie Thomas, Ph.D., is a Lecturer in the Department of Economics at Cornell University and the Program Director for the Institute for Compensation Studies (ICS) at Cornell’s School of Industrial and Labor Relations. Throughout her career, Stephanie has completed research on a variety of topics including wage determination, pay gaps and inequality, and performance-based compensation systems. She frequently provides expert commentary in a media outlets such as The New York Times, CBC, and NPR, and has published papers in a variety of journals.