Cheap Thoughts

Practically speaking full employment can be defined as follows, anyone who is interested in having a job can find one and anyone who wants to work more hours can get those hours.  I have always considered full employment to be unobtainable, something an economy should strive for but which could never be feasibly achieved.  Are we entering a world where that no longer the case?  

My central question is whether or not the sharing economy (Uber, TaskRabbit, Instacart) can actually get us to full employment?  As a side note, I realize that you need a car to drive for Uber or Instacart among some other basic prerequisites, but I want to stay focused on the bigger picture here.  All three of these companies allow individuals 1) The chance to earn income above the minimum wage 2) The ability to clock in and out of work at their convenience 3) Earn income directly proportional to the amount of time they are on the job.  Furthermore, they are looking to rapidly expand their workforce meaning as of today workers can add more hours whenever they want.  Phrased differently, these companies offer employment to almost anyone interested and give their employees a (nearly) endless amount of work to do.

I realize that working for these companies is not "work" in the traditional sense of the word, in Uber's case you are a contractor, not an employee, but I also doubt there are many companies on earth who are hiring as quickly as Uber is right now.  The impact these companies are having on society/the economy should also force us to rethink how we define and achieve our objectives.  My brother is currently in college driving for Uber on the side to make some extra cash, and while I couldn't tell you exactly what he is making per hour it is DEFINITELY over the minimum wage, and he gets to go to work whenever he wants.  For all the debating over exactly what an Uber driver can earn I suspect that everyone is earning above minimum wage salaries.  This new breed of companies gives (almost) anyone the ability to do the same.  I understand there are a whole range of issues that need to be resolved by these companies, their employees. and regulatory bodies, but at the end of the day shouldn't we praise companies who enable that type of workforce productivity?   

I'm going out to Colorado with a buddy of mine to do some skiing in February, we just finalized our accommodations and the sharing economy has really come in handy.  Rather than paying a few hundred dollars per night at a hotel we're staying in someone's basement via Airbnb for roughly 40% of the cost.  I have been following Airbnb closely over the past few years and recommended them to friends and family on numerous occasions, but this is my first time using them.  We also decided to try Relay Rides as opposed to Hertz, Enterprise, etc. for our car rental, which if you're not familiar is like Airbnb for cars. Both of these companies have saved us several hundred dollars, but more than that they have changed how I travel altogether.  These idea's would have seemed utterly outrageous five years ago, but this trip was an "ah-ha moment" for me and one which made me realize how much potential those "utterly outrageous" ideas can have.

The quality of our trip is now in the hands of individuals not companies (for the most part).  The variety of options available to us when making our accommodations has increased dramatically and the costs have come down significantly.  Furthermore, the economic value is now going directly to a person as opposed to a company (again for the most part).  If you would have asked me five years ago what would have to take place for the Hilton's and Alamo's of the world to have their business model threatened I would not have had an answer for you.  When you start to estimate how much money companies like Airbnb and Relay Rides are costing incumbents it really makes you appreciate the nature of innovation. 

I think sometimes we all tend to underestimate how much companies like Airbnb and RelayRides are affecting the world around us.  I urge everyone to take a step back every once in a while and appreciate the progress being made right in front of us.