The
US workforce, which has been one of the most productive and wealthiest
in the world, is undergoing an alarming transformation. Increasing
numbers of workers find themselves on shaky ground, turned into
freelancers, temps and contractors. Even many full-time and professional
jobs are experiencing this precarious shift. Within a decade, nearly half of the 145 million employed Americans are expected to be
impacted. Driving this disturbing trend are U.S. businesses, led by
those in the so-called “sharing economy,” which increasingly rely on an
“independent contractor loophole” that allows an employer to lower labor
costs dramatically. By hiring independent contractors instead of
regular W-2 employees, a business can evade contributing to a worker’s
health benefits, Social Security, Medicare, unemployment, injured
workers compensation, lunch breaks, paid sick days and vacation leave,
lowering costs by 30 percent or more. New app- and Web-based
technologies are making it easier than ever to hire such “1099 workers,”
which in turn threatens to eviscerate the national safety net.
In New Economy, New Social Contract Steven Hill outlines a fair, sensible and affordable way to create a new
safety net for this new economy. Drawing upon what is already working in
the U.S., Hill’s proposal aims to allow workers with multiple employers to
benefit from a fully portable safety net based on Individual Security
Accounts and a greater degree of legal parity between the many different
classifications of U.S. workers.
Read the full paper here.
Correction: This paper has been updated to include an expanded definition of the multiemployer saftey net.
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