Gig Workers, Covid-19 & The Back of the Line
The spread of the Covid-19 virus has led to changes that, just a few months ago, would have been unthinkable to most Americans. State shutdown and stay at home orders, social distancing and PPE guidelines have wreaked havoc on our world both socially and economically. And as we isolate in our homes, every one of us prays for our families, our neighbors and the world.
Last month, the federal government signed the CARES Act into law, providing American businesses, both large and small, a life line during this mandated recession we find ourselves in. Within this historic legislation were provisions that expanded unemployment benefits to self-employed and independent contractors…the so called “Gig Workers" that according to Forbes Magazine (1), make up 36% of the U.S. workforce. This law also expanded a little known “Paycheck Protection Program” so that these gig workers would be allowed to receive loans to help them get through. In all, these two sections of the new law seemed to state that a historically underserved segment of the U.S. workforce would not be left out in the cold. Unfortunately, this hasn't been the case in practice.
More than a month into the roll out of these programs finds the various states at a loss on how to incorporate this new class of workers into state unemployment systems that were not designed to accommodate them. The old tale of round pegs and square holes comes to mind as a large segment of the population depending on this money watches as they are relegated to a hellish limbo, where no answers are available or forthcoming from officials.
The PPP loan program is in the same boat, with 2/3 of the $350 billion set aside for small businesses being snapped up in a matter of days. Only now, five days after applications for gig workers began, after most of the initial funding has been spent, does the Treasury Department release guidelines on what documents gig workers need in order to apply.
This means that, unless more funding is made available soon, gig workers will be the LAST group to be serviced when the feds finally get through with the partisan bickering and pass the further stimulus legislation that everyone knows needs to happen.
Now, I'm not taking a stance on who’s right or wrong in Washington. My point is that, without action soon, it will be too late for a lot of gig workers to climb back out of the hole that inaction, confusion and delays have dug for them. What happens if even 25% of the estimated 57 million gig workers are out of business because of the pandemic? That's over 14 million Americans that form the backbone of the economy without a job to return to. Contrast that with U.S. Labor Department statistics that say that there were 5.1 million unemployed in October 2019 (2).
Why are self-employed/ independent contractors at the back of the line for benefits when we make up the front line of the economy? This is a question that needs answering…and quickly if the American economy is to survive.