Innovation, and the Sharing and Gig Economy

Much of my time is spent with with industry and tech leaders, alumni, current and prospective students and their parents. Often, our discussions turn to our passion for healthy families and communities, enthusiasm for student engagement, and desire to further innovation.

There’s a consensus through these exchanges. We recognize that we must innovate to improve our economic competitiveness and improve prosperity, but we also accept that another reason to innovate is to solve the wicked – and unjust – problems that face our world.

Therefore, some innovations, such as those brought by Lyft, Uber, Airbnb and TaskRabbit, both impress and perplex me. By striking a chord with consumers like me through lower prices, greater convenience – and sometimes facilitating unusual experiences – the peer to peer sharing economy has rapidly disrupted our social behaviour. A LinkedIn analysis reports that many people who have traditional nine-to-five jobs are adding gig work – or part-time freelancing – to their working hours.

More change is imminent. For instance, through a GM and Lyft initiative, drivers will pay US $99 weekly to rent a car with maintenance and insurance costs included. While they’ll pay for gasoline, they will also earn money by giving rides to customers who are matched through the Lyft app. Drivers making more than 65 trips a week would see their rental fee reduced along a sliding scale to nothing.

With this model, one could begin with a couple of driving gigs during the morning commute to work and end the workday with another couple of gigs driving back home. You could also add to your bank balance over weekends.

Whereas gigs are a boon for some workers due to the freedom and work-life balance they provide, others, particularly young workers, receive lower remuneration and forego the benefits they would have as employees.

Sure, you’ll get by, but it’s difficult to get rich by just working gigs. The sharing economy brings more entrants into the market, but with this surfeit of supply earnings can become depressed. For instance, Uber drivers in San Francisco, among the 10 least affordable cities in the world, earn on average $732 per week. Compare that with the $3,510 median monthly rent for a one-bedroom apartment in that city.

Many young people are working their fingers to the bone in the new innovation-leveraged gig economy.  Since they work as independent contractors, not as employees, they cannot claim pregnancy and parental leaves, become eligible for enhanced dental and vision benefits, or save through a pension plan that has an employer-contribution.

I’ve written before how one can only do four things well in life. Since we all have to sleep, this leaves three other things that we can do effectively.

That’s The Rule of Three (TRoT): Pick three things and do them as well as possible.

I believe in giving time to my family, friends and community. As per TRoT,  this leaves only two other things that I can do well. My two professional choices have been academic leadership and engineering research. Restated in terms of Twitter-accessible TRoT, my values are #family, #engagement and #innovation. These three hashtags are the mantra of my life.

Do workers in the gig economy also have the time for three equally important undertakings? If work elongates and displaces something else, and itself occupies two of the three TRoT slots, gig workers have time to do only one other thing well. If they want to engage with the world, they must give up on time with family and community. By focusing on family and community, they would have to  become less engaged with society.

That’s a cruel Hobson’s choice, either work to cover your bills or enjoy your responsibilities as an engaged citizen. It’s also a recipe to separate “grunt workers” from the “thinking” elites.

Hence, I encourage our students to think of innovation very broadly. While entrepreneurship is the stuff that appears regularly above the fold, we should continue to pursue the social innovations that will improve the lot of the many, not just a few.

At McMaster Engineering, we believe that our mission is to educate engaged citizen scholars who will transform our world. As the class of 2017 prepares to graduate, I pose a question to these talented and thoughtful young women and men.

How can entrepreneurship that drives disruptive innovation also foster equitable and inclusive social outcomes?

 

 


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