President Obama was a huge fan of the “gig economy” in which Americans were empowered to work for companies and individuals without the burden of being full-time employees. Granted, much of his love for it was based on the original tenets of Obamacare which mandated these people go through the Affordable Care Act’s insurance exchanges, but it also allowed for technological and economic growth without the challenges associated with keeping a massive workforce in place. The unions hated it, but President Obama was one of the few Democratic Presidents in modern history who was not beholden to the unions.
Unfortunately, today’s Democrats are beholden to unions, especially the radicals in Sacramento who came up with AB5, the new law that will destroy the gig economy in California and much of the rest of the country. It eliminates the ability for independent contractors to remain independent contractors if they work for companies like Uber, GrubHub, or any industry that gives their workers these freedoms. Even freelance journalists in California are already getting notices from the publications they write for saying their services will no longer be allowed.
Essentially, AB5 prohibits independent contractors from taking gigs. They must choose between being employees (and therefore paying the union dues that invariably go to Democratic lawmakers) or moving to a different state that doesn’t trample on freedoms the way California does. Keep in mind, this is a trillion dollar industry that will be decimated by the law of a single state. That’s the type of power California holds. By outlawing the freedoms of workers in the gig economy and the companies who pay them, the effects will be wide-spread as companies have to choose whether or not their business model will still be feasible.
As Forbes noted:
According to the Freelancing in America survey, there is a reported 57 million American freelancers contributing an excess of $1 trillion dollars to the economy each year. Recent data shows more than 75% of freelancers are working independently by choice. Due to the accessibility of apps and sites like Upwork, Instacart and Uber, to name a few, people can work on terms they prefer and accept opportunities that feel right for them.
If freelancers are reclassified as employees, they’ll have to trade in their freedom for structure, potentially losing their ability to set their own hours. Of course, that’s only if the company chooses to continue the relationship and convert them into an employee. Lorena Gonzalez, author of Assembly Bill 5, insists the goal of this law is “to create new good jobs and a livable, sustainable wage job.” Supporters emphasize the benefits and protections gig workers will receive such as health care subsidies and a guaranteed $12 state minimum hourly wage, but fail to address the consequences of the new law.
Upwork’s survey revealed 51% of freelancers said no amount of money would entice them to return back to or take a traditional job. This is a result of them earning more than 70% of workers throughout the United States with a median hourly rate of $28 per hour, more than half of the state minimum wage. As the labor market strengthens, the next generation of workers are more empowered by the flexibility, pay and opportunities freelancing brings over the benefits of a corporate job.
This is 2019. Mobile and digital technology have empowered the gig economy by connecting people who can be paid to deliver a service to the people willing to pay for that service to be delivered. For a state so reliant on technology as the home of Silicon Valley, it’s ironic that they would be the ones to pass laws against technological advancement.
What’s even more ironic is this is being done in the name of progress. Yet, progressives in California are latching onto the money-flow from the archaic burdens of big unions. These unions and their Democratic puppets in Sacramento have forged an alliance against 21st century progress.
The worst part of this is that it’s anti-American. The gig economy was born from the freedoms associated with our nation. It gives flexibility to both employees and employers, a necessary component for both to be able to take risks and test waters without committing to a direction through direct employment. This flexibility is as American as it gets; freedoms on both sides of the employee-employer divide make for amazing work relationships.
Gigs are not for everyone and using contractors instead of hiring employees isn’t best for every company. But allowing people and businesses to take advantage of the options fosters creativity, growth, and a strong work-life balance. This is just another reason to recall Governor Gavin Newsom.
This is indicative of what radical progressivism does, especially when it’s beholden to big labor. Gig employees and employers both want freedom. But California Democrats will screw both over for the sake of union dues that get redistributed to them.