Work organization in the gig economy: Invisible overheads of platform-based work

Domain: Sociology and Humanities

Work organization in the gig economy: Invisible overheads of platform-based work

Johanna Hofbauer, Vienna University of Economics and Business, Institute of Sociology Dominik Klaus, University of Vienna, Institute of Sociology Angelika Schmidt, Vienna University of Economcs and Business, Institute for Change Management

Abstract submitted to “Reshaping Work in the Platform Economy”, October 25-26 2018, Amsterdam

Changes in the world of work through digitization are not limited to the ways in which work is executed, but have also created new forms of work organization. New forms of work organization, in return, can shift boundaries between paid and unpaid labor, e.g. when work has been outsourced by organizations and turns into self-employment. Here, workers may have gained discretion over the accomplishment of tasks as well as time-sovereignty, while management deliberately confines itself to goal-setting and cost-control. In the context of market-driven governance, however, self-employed workers or freelancers equally face performance and time pressure.

This paper argues that the outsourcing of services includes the outsourcing of necessary support services. Online freelancers take on e.g. IT-support services, administrative tasks or customer relations tasks. Those tasks used to be provided by specialized employees or even departments within a company, they caused overheads to be covered by product prizes. With online freelancing, those suport activities tend to be regarded as part of an all-inclusive package of outsourced service. When work is taken for granted, extra payment is unlikely. Research found that online freelancers depend on informal relations to guarantee constant functioning of their working equipment, they rely on friends who help solve software issues or on family members who give informal support with customer relations or administrative tasks etc. (Campbell/ van Wanrooy 2013) Given that the “support services” provided by those “social coproducers” (Matschuek 2003) include activities that are not accounted for as “work”, the timelines for online jobs can easily underestimate the actual investment of time, and the calculation of costs for online services can undervalue the actual amount of work put into the accomplishment of the service.

Digital job placement platforms have made it possible to intercede jobs that previously were embedded in regular employment activities. Tasks that have hitherto been carried out as part of an employment in a company are now outsourced to an anonymous crowd of workers. Automated rating algorithms and the technical design of order processing simplify performance control and significantly reduce transaction costs. Managerial control has, in other words, turned into indirect control of contractors on the market. While, at first glance, platforms only assume coordination functions, management control is still carried out in form of algorithmic management as a guiding principle that combines tight control over the quality of service and time frames for task accomplishment. With this management principle the working conditions of online freelancers seem to be quite charged.

Algorithmic management can be defined as oversight, governance and control practices conducted by software algorithms over many remote workers (Möhlmann/ Zalmanson 2017). Algorithmic management is characterized by continuously tracking and evaluating work behavior and performance, as well as automatic implementation of algorithmic decisions. Companies as (important/dominant, e.g. Amazon) clients determine the terms of trade, the frequency and range of jobs offered, as well as deadlines for the accomplishment of jobs. Platforms are creating surety for their clients. However they ignore building trust with their freelancers (Lehdonvirta 2016). In many cases, the system is less transparent, and workers can have no knowledge of the set of rules governing the algorithms.

In the paper, we aim to contribute to management discourse and to engage in the critical debate of new forms of management control. Moreover, we argue that the notion of overheads and sources of time-investment as unpaid labor should be included in the debate on how work is performed and distributed as well as how tasks are recognized as work in order to promote social appreciation (Voswinkel 2012). The example of online labor shows how individuals are constantly required to reorganize and re-coordinate their time budgets (Wajcman 2015). Furthermore, we suggest to include the whole range of activities, or: ‘work’ that individuals invest in order to mediate between the requirements of flexible or insecure jobs and private needs. This should allow to open research foci for work that requires considerable investment of unpaid labor and the exploitation of private resources in order to be able to accomplish jobs in the gig-economy, and to allow ensuring job delivery and sustainable income in crowdworking constellations. We aim to study the outsourcing of overheads in the emerging field of crowdwork, using theoretical lenses of (feminist) sociology of work and drawing on empirical research in the crowdworking sector.


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