The Sharing Economy Is a Free Market Safety Net

As I got into my Uber the other day, I complimented my driver on her fabulously styled hair. As our conversation progressed, I learned she was a hairstylist but currently out of work. She was hoping to transition out of the salon world and into house calls. But while she was mapping out her plan of execution, ridesharing was providing her with a temporary job where she was able to make money.

The sharing economy has been one of the most groundbreaking market creations in our modern time.

The sharing economy has been one of the most groundbreaking market creations in our modern time even though its concept is quite simple. If you own a car, you can earn money as a driver. If you have an apartment or home, you can earn money renting out the space. There really isn’t much to the sharing economy. If you have property or a skill that is in demand by another consumer, you have the ability to earn money. And for those in between jobs or trying to figure out their next employment move, the sharing economy can be a lifesaver.

Providing a Cushion

This story is far from an isolated instance. When I was living in Washington, DC, I once had the pleasure of riding with a driver who was currently out of work while she was recovering from surgery. The surgery itself was minor and still allowed for the operation of a vehicle. And even though her job would be waiting for her when she was healed, she had used up all her paid time off, and was not making money during the recovery process.

But thanks to Uber, my driver didn’t have to worry about income or filing for short-term disability or other welfare programs while she waited to get back to work. She was earning money while avoiding the stir-crazy feelings of being trapped inside her house while she healed.

Another driver I rode with in DC had recently moved to the United States from the Middle East and was trying to start his own catering business. Not only did Uber allow him to pay his bills while he was starting his business, it also helped him network. Each of his passengers was given a business card and one free “trial” meal which he would personally deliver. The same thing happened with the hairstylist. We exchanged numbers and we both benefitted: I found a new hairstylist and she gained a new client. The possibilities of the sharing economy are almost limitless.

I could tell dozens of these stories, as I am sure many of you could as well. Ridesharing helped all these drivers provide for their well being and even helped some build their businesses. But ridesharing is only one small sector in the broader sharing economy.

One of the most stressful components of sudden unemployment is the worry that rent won’t be paid. But the homesharing sector has also provided a solution. As long as you have a friend who is willing to let you sleep on their couch or perhaps family who resides nearby, there are ways to rent out your lodgings in order to pay the bills.

But the sharing economy is not limited to property. There are many who many find themselves unemployed without either a car or a rentable living space, but they may have a skill. Smartphone apps like TaskRabbit allow users to sell their own labor. If you possess the muscles needed to move boxes all day, you can become a mover. If you are capable of mowing a lawn, you can find someone in need of a yard trimming. The possibilities are almost limitless. And while these are not the most glamorous of tasks, continuing to take on jobs and working during times of unemployment can have a positive psychological impact.

For those in the beauty or wellness world, there are also apps that will connect cosmetologist and hairstylist to clients, something I was sure to tell my Uber driver.

Mental Well-Being

Work is not some construct invented by evil capitalists to reduce individuals down to their productivity and labor. It is a source of pride and self-esteem. Whether you are writing the next great American novel, operating equipment in a manufacturing plant, or constructing a hamburger in a fast food restaurant, there is a certain sense of pride that is gained from a job well done.

Work is a source of pride and self-esteem.

While driving in the Uber with my new hairstylist, she politely interrupted our conversation to offer me a water and a snack. I am accustomed to Uber drivers offering me water, but the snack was new. Why does this small detail matter? Because there was a sense of pride in her voice. She may not be doing what she had hoped with her career, at least not yet, but staying in the workforce via the sharing economy did more than just bring in income: it maintained dignity. She wanted to do the best job possible because she took pride in her work.

When that daily opportunity to take pride in creation is removed because a person is unemployed, especially for longer periods of time, there are psychological impacts that extend far beyond the stress that comes with money problems. In fact, depression and unemployment are an ominous duo.

The lack of social interactions can wreak havoc on the psyche. When you are isolated away from people, without a soundboard to vent life’s troubles or receive feedback, you are left with your own thoughts. In times of trial, like unemployment, this allows the worst thoughts to come to mind. Many even begin doubting their abilities, which then sends them into a depression spiral making the job hunt increasingly more difficult. No one wants to go into an interview when they are not feeling their best mentally.

The sharing economy is presenting its own safety net against the vicious cycle of unemployment.

But the sharing economy is presenting its own safety net against the vicious cycle of unemployment.

Uber and ridesharing in general is a great way to not only socialize with other humans, but can also be beneficial for preparing for an interview. Once you are able to master the art of conversation without the often accompanying nerves, you have gained a skill that may help during the interview process.

Realistic Solutions 

Is the sharing economy the perfect solution to the problem of unemployment? Absolutely not. But neither is our current unemployment system. What it does offer is a realistic approach to the problem. Just as there are boom and bust cycles in business, so do these cycles exist in life. One moment you are on top of the world and the next you may find yourself unemployed with a mortgage and a family to support.

Our current unemployment system comes with red tape, strings attached, and a whole lot of bureaucracy. And all this must be endured before even receiving that first unemployment check. But so long as the government allows the existence of the sharing economy, the market can continue offering nearly instant employment opportunities to those looking for work.