Last week, the gig economy gained a major victory after a U.S. district judge ruled that limousine drivers for Uber are contractors — not employees. Razak v. Uber Technologies Inc. is expected to head to federal appeals court in the near future.
The plaintiffs, drivers for the ride-hailing company’s limousine service, UberBLACK, argued that they were employees, but U.S. District Judge Michael Baylson determined that Uber doesn’t have enough control over its drivers to be classified as their employer under the federal Fair Labor Standards Act.
This major win for Uber and its competitors will continue to support the countless millennials who depend on these “gigs.” The “independent contractor” status of these positions keep overhead and liability low for companies like Uber, which means more opportunities for young people.
According to Intuit, “gig” workers represent more than a third of the American workforce. This number is expected to reach 43 percent by 2020.
The gig economy has been a blessing to underemployed millennials, helping them build their networks and gain new experiences instead of treading water until their next big break. Underemployment has risen steadily over the past three decades, hitting a whopping 44 percent in 2012. Unsurprisingly, according to the Millennial Economy Report, 44 percent of surveyed millennials have a side hustle.
Arguably the biggest problem facing the U.S. economy and millennials at large is the so-called “skills gap.” Degrees aren’t translating to jobs, and a few Uber rides could mean the difference between living independently and moving back in with mom and dad. While full-time employment has its obvious benefits — insurance, retirement and normal hours — it’s not accessible to everyone.
The gig economy has provided a shameless safety net for millennials to work as hard as they want, whenever they want. The endless opportunities afforded by the gig economy help young people supplement their income. At the same time, the gig economy has chipped away at the chokehold that unions once held on young American workers, allowing them to keep more of their hard-earned money.
This freedom and flexibility is what has drawn millennials to the gig economy for years, and is why it continues to grow despite a recent uptick in jobs under the Trump administration. Any change to the contractor status of these workers could destroy a booming industry and trigger yet another setback for hardworking millennials.
