Uber has taken one step towards creating a true sharing economy, or rather two steps back. On Tuesday May 10, it arrived at an agreement with the International Association of Machinists and Aerospace Workers, officially recognizing 35,000 Uber drivers in NYC as a guild. This will grant these drivers minimal rights to voice their formerly voiceless sentiments to the San Franciscan company, but while it might appear as a hopeful indicator of a time when they’ll actually ‘share’ more in the overall management of this same company, a quick refresher of its business model reminds us that such a hope is very, very faint.
The most obvious other sign that Uber won’t really be sharing anything anytime soon with its own contractors is that, as a guild rather than a union, these contractors still aren’t legally able to bargain as a collective nor strike. Another revealing tell is that Uber has no plans whatsoever to transplant the guild idea outside of NYC, thereby denying its 292,000 other active drivers the ability to even express their opinions in an official venue.
Still, these two signals are downright superficial compared to the more penetrating hint furnished by the company’s business model, which as the prime example of the much-touted ‘sharing’ or ‘gig’ economy is based upon one fundamental principle: transforming the general public into one giant, ever-ready labor market. Such a transformation is enabled by an app and a web platform that permits Uber to inexpensively draw anyone with a car into its available pool of ‘independent drivers,’ which as a result of its superior scale makes the time and labor of these independent drivers as cheap as possible.
In other words, the whole logic of Uber is centered around exploiting a massively aggregated pot of potential contractors who flit in and out of driving for the service depending on economic circumstances. This is indirectly confirmed by Uber CEO Travis Kalanick, who has previously said that more than half their drivers put in nine hours or less a week, using their work for the company as “a way to fill in the gaps” that occasionally appear in their normal professional lives. What this means is that the success of Uber is based on its ability to harness the excess capacity of every person with a car who is currently unoccupied, and it’s precisely the status of these people as underused by their usual industries that enables Uber to charge such low fares and undercut their competition.
As such, the threat of professionalization posed by the collectivization and unionization of its contractors is also the threat of a reduction in the supply of casual laborers, of people who can accept lower rates and commissions because their driving work is only “a way to fill in the gaps.” If these contractors begin forming guilds and unions then their membership in such groups will be tantamount to an encouragement to approach their work for Uber as an actual job, rather than an occasional stopgap during periods of underemployment. This is corroborated by research in various nations that shows how unions reduce employee turnover, in the process creating a body of workers who are more fixed, less flexible, and less willing to accept the kind of maximally efficient and dynamically priced fares that form one of the cornerstones of Uber’s model.
This is why Uber went only so far as recognizing its NYC drivers as forming a guild, and why it would probably rather shut itself down than begin encouraging its drivers to organize into unions. To do such a thing would go completely against everything that up until now has made it such a radical business, transforming it into just another company with a full-time, professionalized workforce to look after. It would be much less able to lower its prices during slumps in demand, because it would have much less access to flexible, on-and-off drivers who are okay with lower fees.
In sum, it would be much less able to be Uber, which is why the company has continually opposed attempts outside of NYC to collectivize its drivers. But it’s also fought other measures that would have the effect of making it harder for people to enter its pool of excess capacity, with such dogged resistance once again betraying the fact that its whole business model is predicated upon the greatest possible widening of this pool. Along with Lyft, it pulled out of Austin, TX after the city voted to impose mandatory fingerprint checks for its drivers, a measure that would have undermined the purpose of creating an ever-expanding crowd of casual workers whose massive supply of competing labor allows Uber to underprice normal taxis by around 50%.
From many angles, this commitment of Uber’s towards resisting the organization and validation of its contractors warns us that its primary innovation is not so much a handy app that connects drivers with riders, but rather its abolition of the worker as such. Essentially, it has harnessed technology to invent a business that does away with employees while paradoxically maximizing labor capacity and competition at the same time, a near-revolutionary if dastardly feat which other companies and businesses desperately try to emulate whenever they sell themselves as the ‘Uber for X.’
And while the formation of the Independent Drivers Guild in NYC might insinuate that actual employees are about to begin infiltrating Uber’s universe for the first time, the corporation’s model strongly insinuates the opposite. Much like Airbnb’s aborted attempts to push unionized cleaners on non-unionized accommodation-sharers, its recognition of the Guild was mostly a tokenistic concession intended to save its precious model from any further calls for workers’ rights. Even though this model is facing direct challenges in Seattle and elsewhere in the US, it still remains the pride and joy of the so-called sharing economy, although unfortunately the general public still shares more with it than it does with them.