FinTech Silicon Valley Jobs

This Election, California’s Proposition 22 Puts the Future of Labor on the Ballot

As Californians return their mail-in ballots, some of Silicon Valley’s largest tech companies have bombarded voters’ social media accounts, text messages and TV stations with a simple message: vote “yes” on Proposition 22.

The ballot initiative, written by a consortium of app-based companies, has ignited a nationwide debate on the future of work. If passed, the proposition would enshrine tech companies’ ability to classify their workers as independent contractors. If struck down, however, the proposition could set the stage for future regulations against tech companies found to use exploitative labor practices. As debates on workers’ rights factor into this November’s heated election, Californian voters may set a legal precedent for future labor movements in an increasingly tech-based economy.

As Uber, Lyft and similar gig models gathered a larger market share, more and more displaced workers in San Francisco and Silicon Valley became drawn to such platforms. From 2012 to 2014, gig employment grew across San Jose by over 144%, while neighboring San Francisco experienced a similar increase of nearly 142% in the same time frame.

While critical to the region’s burgeoning economic output, the explosion of gig labor across Silicon Valley has contributed to the region’s staggering income inequality. A 2018 study conducted by researchers at University of California, Santa Cruz found that only the top 10% of workers in the region experienced real wage growth in the past 20 years. Middle-income earners saw their wages decrease by 14.2% while the lowest 40% of wage-earners also experienced varying rates of wage decline.

As more San Franciscans rely on gig platforms for income, the compounding threats of this labor model intensify. As explained by Steve Smith, communications director for the California Federation of Labor, “Many of their drivers are working for as little as $3 to $4 per hour, creating hardships for them and lowering labor standards for all workers in the area. With tens of thousands of workers in the state’s urban areas making less than minimum wage, that has an impact on everything from small businesses to state and local governments.” Read more via HarvardPoliticalReview

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