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Ask HN: What do you think will happen to the Gig economy with the bill?

• baggy_trough 7y ago
  Here are some of the numerous regulatory issues that companies will need to deal with. It seems almost impossible. http://coyoteblog.com/coyote_blog/2015/06/ca-labor-commission-has-just-killed-uber-though-it-may-take-years-to-bleed-out.html http://coyoteblog.com/coyote_blog/2015/06/ca-labor-commissio...
  • Shopr 7y ago
    Thank you for sharing this, I didn’t even take in the smaller thinks like sexual harassment training into consideration. Reading over your article definitely makes it seem impossible in the current state we’re in. This will definitely require higher prices for the services. How do you feel about the bill? Are you for or against it. From what I read your article seemed pretty objective.
    • baggy_trough 7y ago
      Personally, I'm against the bill, because I think California has a very poor regulatory environment for running a business, and it seems to be getting worse all the time. This just adds to that problem, in some cases dramatically. Note, I didn't write the article.
      • dmode 7y ago
        California has the 4th largest economy in the world and is growing faster than most states. In 2019 alone, California probably created ~$300bn in public value through IPOs. Clearly, the regulatory environment seems to be great for running a business
        • malandrew 7y ago
          California succeeds despite the regulatory environment. Hollywood is there because of the great weather and sunshine which allowed filming all year long. Tech is there because of the defense industry set up there during WWII. Agriculture is there because of the great weather and soil. Basically, every advantage California has is the result of its geography and weather. If you remove these three industries, there isn't much of an economy that isn't dependent on the money that these three industries bring into the state.
          • dmode 7y ago
            Florida has all of these, but doesn’t have the same economy Edit: actually, let me get into more detail on why I reject this hypothesis that I hear all the time "California is successful despite its govt / regulations etc.". I reject it in the simple notion that if the regulatory environment was bad for business, it will BE bad for business and it will play out over a time period on actual outcome. It is almost like a product manager saying that "I have the best product, but my users hate it". The fact is that the regulatory environment created the most successful economy in the US is the only thing that matters. Now let me get into why the regulatory machine works - first of all California legislature understands that we live in a knowledge economy - which means a low value regulatory relief like tax cut is unimportant. Rather, what people in the knowledge economy are looking for are safety nets, equality, worker protections, anti-competes, accessible healthcare, acceptance etc. The same arc that provides the strongest LGBT protection in the nation also passes AB5, with the sole intention of protecting worker rights. California laws provides volumes of the above - resulting in global talent willing to move here. Couple that with strong environmental protections, which not only provide recreational opportunities, but also spurs alternative industries. Looks the explosion in solar providers, electric car companies etc.
• anovikov 7y ago
  If they really relied on revenue and profit, so function like normal businesses, they would simply register overseas and pay drivers using bitcoin. Problem for those companies is that they rely on inflated valuations fueled by printed money i.e. basically robbing these same contractors but in their old age, their future pensions/public funds... Which leaves them in quite a difficult predicament, but why should we care?
• prepend 7y ago
  I think it will have a bigger impact on FedEx and the “real gig economy” that has millions of contractors.
• deleted 7y ago
  [deleted]
• buboard 7y ago
  Almost every company had an "unfair competitive advantage" until regulation took over. It seems the gig economy did not move on to other things fast enough and now they 've "overstayed their welcome".
• rajacombinator 7y ago
  Haven’t read anything about it but the usual outcome in situations like this is that entrenched players (who secretly backed the politicians responsible) come up with a clever legal structure that allows them to evade the laws. Small players can’t compete and are forced out by barriers to entry. Politicians collect fat checks. Citizens are either oblivious or confused why life got worse. But it goes on.
  • sloaken 7y ago
    I could not agree more, and that is why I hate ALL politicians, and the corporations that buy them.
• dmode 7y ago
  There are several ways it can play out. Governor can veto the bill or can seem amendments that codifies some exemptions for the gig economy. If the bill passes as is, Uber will most likely continue to operate as is and battle it out in court. The ABC test is still fairly vague and if you can build a true marketplace, where buyers and sellers have full control, you don't have to change anything. Think of the eBay model. Uber can make some fundamental changes, like allow drivers to set prices, select rides etc. and give them more control. If Uber chooses to convert some drivers to employees, they will probably raise prices to cover those costs. This will play out over the years, but the fundamental message is clear, don't run a business whose business model depends on having everyone as "contractors"
• gshdg 7y ago
  Business models that rely on being able to exploit workers who are desperate for income by compensating less than is required to survive in the expensive cities where those businesses operate will fail. This is not a bad thing.
• 401kguy 7y ago
  This does not generalize to the broader gig economy, but I expect quarterly losses will increase for Uber and Lyft, whether due to adhering to or fighting the bill. While I’m not a fan of either company, heavy blows to both have the risk of putting Lyft into a downward spiral as they have far less capital to weather a storm than Uber. If the duopoly becomes more like a monopoly that would give Uber even more leverage over drivers.