Skill-Biased Technical Change, Again? Online Gig Platforms and Local Employment

This study explores the impact of online gig platforms like TaskRabbit on the employment of incumbent service workers, focusing on the housekeeping sector. It highlights how TaskRabbit’s entry correlates with a decrease in middle-skilled roles such as supervisors due to automation, whereas low-skilled jobs like janitors remain stable because of their manual nature. Notably, many middle-skilled workers transition to self-employment within the sector instead of facing layoffs. Amidst competing narratives about the gig economy’s influence on labor markets, this research offers critical insights into how gig platforms redistribute the workforce and create new employment opportunities, suggesting significant implications for policymakers and practitioners. Policymakers should recognize the shift from traditional roles to self-employment facilitated by these platforms, which enhances local entrepreneurship. Meanwhile, it is crucial for them to ensure fair working conditions, wages, and benefits. Practitioners can see that gig platforms not only improve operational efficiency but also enable middle-skilled workers to launch their own businesses, indicating a potential strategy for new platforms looking to increase their service offerings and client base. Traditional companies, in response, need to adapt their job designs, incentive structures, and company culture to align with the changing needs for flexibility and autonomy in the gig economy.