It took a pandemic for America’s army of gig workers to win access to some of the social protections that regular employees enjoy. Now they’re about to lose it again.
Even before Covid-19 hit, the independent-contract model for workers was spreading, with companies turning to it as a way to lower costs. The health crisis accelerated that trend, and spurred policy makers to offer financial support for freelancers when much of the economy was shuttered.
The Pandemic Unemployment Assistance was the first federal-level program geared toward so-called independent workers. It’s now being wound down, leaving the Biden administration struggling to figure out how to make life less precarious for a rapidly growing share of the workforce.
Freelancer Boom
For Rubi Jones, a 33-year-old freelance hairstylist, the PUA was “a breath of fresh air.” In the absence of any safety net, her strategy often was to work long hours. When expecting her daughter, Jones cut hair until she was eight-and-a-half months pregnant, and she was back on the job four weeks after giving birth.
When the pandemic hit, that route was closed. “My work 1,000% shut down,” she said. “From March 13 up until June, when re-openings happened in New York City, I didn’t touch hair except for my own.” Instead she enrolled in the PUA, like more than 15 million Americans did last summer.
There were still about 5.3 million participants in the program as of July 9, and an average of about 100,000 new claims have been filed each week since then. But at least half of U.S. states have already ended pandemic unemployment benefits, and more are set to follow before the Sept. 6 deadline set by Congress.
Some 59 million Americans freelanced in 2020, and the number is poised to increase. A new study by recruitment firm Upwork found that one-fifth of professionals—equivalent to 10 million people—would consider going freelance, mainly to preserve work-from-home flexibility. About 90% of businesses expect to increase their reliance on non-payroll workers within the next year according to a June survey by contractor management company Stoke.
That means risk is shifting from businesses to individuals, said economist Laura Sherbin, senior vice president at Seramount, a consulting firm focused on workplace diversity. With less job security, what workers really need is a stronger social safety net, Sherbin said.
Back In Limbo
Instead, many U.S. gig workers are getting thrown back into the safety-net limbo that preceded the pandemic.
President Joe Biden has backed some measures that may offer them help. The Protecting the Right to Organize Act would make it easier for workers to unionize and collectively bargain, even if their companies claim they are contractors rather than employees.
But it faces a tough passage through the Senate, with Democrats short of votes to overcome a filibuster on top of a backlash from business. The National Retail Federation called it the “worst bill in Congress.”
Another bill in the Senate would allow big-name gig corporations to provide benefits to workers who aren’t formally employees—but only for the duration of the pandemic. It’s also unclear how much the administration’s American Families Plan and American Jobs Plan would benefit freelancers.
There’s “still a big question mark” over how Biden will provide more security for this growing share of the population, said Rafael Espinal, executive director of the Freelancers Union, who reckons the PRO Act should be the top priority.