The Precarious Conditions of Solopreneurs
"America’s new proletariat workforce goes by a lot of different terms – freelance, independent, temp, part-timer, contractor, contingent worker and the under-employed. The newest term for such workers, one only a Silicon Valley company like MBO Partners could come up with, is “solopreneurs.”
These workers share many of the same conditions: no employer-sponsored health insurance, 401Ks or FLEX accounts; no Social Security employee contribution or unemployment compensation; no sick or vacation pay; no chance to join a union or move up the corporate ladder. They do share the one attributed that Marx identified 150 years ago: These proletarians have nothing to lose but their chains.
NBC (excluding its apparent plan to cover Mukpo’s medical bills) is but of one of a growing number of corporations who are shedding any obligations they have to “their” employees. Apple, famous for its computers, iPhones and iPads, has an 810,000 workforce of which only about 8 percent (60,000) are actual employees, the rest – 750,000 workers – are sub-contractors grinding out the postmodern Tinker Toys on endless Chinese assembly lines.
Apple is not alone in using sub-contactors. Wal-Mart’s warehouse workers are contractors; Comcast owns its cable networks but its technicians are out sourced; UPS “employs” some 300,000 contractors; and the desk worker who greets you and the cleaners who make your bed at hotel chains like Marriott and Hilton are indie workers. And this does not include the army of functionaries who are contract laborers for federal, state and local governments.
A growing number of hip web startups — and are part of what is called the “sharing economy” — are joining the ranks of those employing solopreneurs. Among these ventures are AirBnB, Lyft and TaskRabbit.
Whitney Johnson, writing in the Harvard Business Review in 2013, estimated “approximately 43 million people, or roughly 35%-40% of the private workforce in the U.S., are currently doing some type of contingent work; this number is expected to grow to 65-70 million within the decade, well ahead of the 1% rate at which the labor force is growing.”
One doesn’t have to be Marx to understand what drives the reconstitution of the American labor force – it’s the profit motive, dah. In 2010, the Bureau of Labor Statistics estimated that an employee’s compensation was $29.71 per hour, with wages accounting for 69.6 percent and benefits averaging 30.4 percent of the total employee cost.
According to BusinessWeek, employers can save up to 30 percent by hiring indie contractors. As contractors, companies evade minimum wage and overtime laws. Shifting employees to independent contractors or self-employed, employers safe 15.3 percent for Social Security and Medicare charges as well as attendant state or local taxes.
CityLab presents a remarkably revealing breakdown of independent, freelance or contract labor by occupation and pay scale, “The Geography of America’s Freelance Economy.” Check it out.
The Great Recession and the ongoing sluggish recovery have helped fuel sustained labor organizing efforts throughout the country. The push for a $15 minimum wage among fast food and other workers has led to municipalities around the country, most notably Seattle, to up the minimum wage. The recent Communications Workers of America (CWA) organizing victory of some 9,000 at American Airline passenger service agents heralds, in the words of the AFL-CIO, “the largest labor organizing victory in the South in decades.” An organizing struggle is now underway by Facebook van drivers who are subcontracted from Loop Transportation.
Equally critical, a series of court actions may address the fiction of the new proletariat, the contract laborer. In August, a federal court panel in October ruled that FedEx Ground misclassified 2,000 California drivers as independent contractors. It ruled that the workers could sue for unpaid wages and benefits. In early October, the Kansas Supreme Court ruled in favor of the federal decision.
Two class-action suits are now working their way through the Massachusetts and California court systems challenging Uber’s classification of its drivers as independent contractors. These workers not only use their own cars, but they get no sick time, no health insurance, no 401(k) contributions.
These two strategies – organizing and court challenges – are likely to increase as efforts mount to address the inequities of contract labor. In this process, freelancers and solopreneurs alike may well recognize themselves as the 21st century proletariat with nothing to lose but their chains." (http://www.counterpunch.org/2014/10/24/meet-the-new-proletariat/)