Among the trends which characterize the changing nature of work, the growth of the online platform economy has been steady and fast in recent years. Technological progress and digitalization are at the basis of its current development. Due to the overall exponential growth of internet facilities, an increasing number of workers are participating in what is described as the gig, on-demand, or platform-based economy.
These workers are usually called crowdworkers, where crowdwork is defined as an “employment form that uses an online platform to enable organizations or individuals to access an indefinite and unknown group of other organisations or individuals to solve specific problems or to provide specific services or products in exchange for payment.”
Poor working conditions?
A number of studies have shown how these workers suffer from the erosion of fundamental labor rights, the loss of social protection and difficulties in exercising collective action. These issues are especially acute for platform workers involved in the so-called micro-tasks (a series of small tasks which together comprise a large unified project and can be performed independently over the Internet in a short period of time), which are more exposed to risks concerning low pay, precariousness and poor working conditions.
It would be a mistake, however, to assume that platform work has a causal effect on working conditions solely based on the evidence of these descriptive studies, as it could be argued that the characteristics of crowdwork are intrinsically different from traditional salaried professions.
In light of these crucial issues, a recent IZA discussion paper by Michele Cantarella and Chiara Strozzi analyzes a large fraction of the available evidence on earning and working conditions of crowdworkers involved in micro-tasks, focusing on data both from the United States and Europe.
Platform workers vs. traditional workers
Does working on online labor markets have an impact on earnings and working conditions across the US and the EU? Are individuals involved in micro-task crowdsourcing intrinsically different from traditional salaried workers involved in comparable occupations? The paper addresses these questions by comparing outcomes in working quality between online-platform and traditional workers in a quasi-experimental approach, exploiting caregiving as an exogenous source of variation influencing participation in crowdwork rounds across the female population.
The authors’ contribution is based on an empirical analysis of cross-sectional data collected from three different surveys and harmonized in order to obtain the greatest degree of comparability. The aim is to provide an unbiased comparison of earnings and working conditions of platform workers and ‘traditional’ workers across control and treatment groups, where variations in outcomes are analyzed conditionally on a binary ‘treatment’ variable indicating participation into crowdwork.
For both the US and Europe the treatment groups include information on crowdworkers from a number of online platforms – namely, Amazon Mechanical Turk (AMT), Crowdflower, Clickworker, Microworkers and Prolific Academic – coming from two dedicated surveys distributed by the International Labour Organization, while the control groups include information from available extended surveys on American and European workers’ conditions (American Working Conditions Survey, European Working Conditions Survey).
Crowdworkers earn less and would like to work more
Their findings indicate that, overall, crowdworkers earn about 70% less than ‘traditional’ workers with comparable ability, while working only a few hours less per week. For both the US and EU, those differences are not affected by the observed and unobserved ability of individuals. Also, platform workers appear to be uninterested in looking for other forms of occupation, while still expressing the desire to work more than what they currently do.
According to the authors, these results suggest that the labor force in crowdworking arrangements may suffer from high levels of under-utilization, relegating crowdworkers into a new category of idle workers whose human capital is neither fully utilized nor adequately compensated.