Home / Opinion / Columns /  Karl Marx and the case of the Uber driver

Platforms operating in India, from cab-hailing apps to food-delivery companies to market places, continue to be in the news. More often than not, the news concerns the working conditions and remuneration of gig workers who ensure that the digital-technology-heavy business models of these platforms keep working.

A platform is basically an app or a website which matches a supplier with a prospective customer. An example is a food-delivery app that matches a restaurant with someone who is ordering food. While technology brings the restaurant and customer together, it’s the delivery riders, the gig workers in this case, who must collect the food from the restaurant and deliver it.

Those on the side of platforms argue that no one is forcing gig workers to take on these jobs, but the fact that they are means they need the money. It’s like the self-selection that happens in the case of the Mahatma Gandhi National Rural Employment Guarantee Scheme. Only those who can’t find better-paying jobs end up working for the work-guarantee scheme. Similar motives apply to gig workers lining up to work for platforms. This is the argument being made. While it is true, there is much more to it.

The one thing that differentiates platforms from a traditional company is their asset-light model. As Azeem Azhar writes in Exponential: “The platforms facilitate an exchange without actually having to spend any (or much) money. The world’s largest cab company, Uber, owns no cabs and employs no drivers. Airbnb hosts more overnight guests than any hotel chain, yet owns no hotels."

Nonetheless, these platforms need people to execute their business model. Amazon needs people to deliver products. Zomato needs riders to deliver food and groceries. Uber and Ola need cab drivers. Urban Company needs trade service professionals.

The interesting thing is that platforms go out of their way to explain that gig workers are not their employees. But can that argument really be made? A good parameter to distinguish an employee from self-employed individuals is the degree of autonomy, control and flexibility they have in their jobs. As Azhar writes: “Gig workers are managed by computers… Rideshare drivers may only have 10–20 seconds to respond to an offered ride, without knowing in advance where they’re expected to go... If they refuse too many rides in a row, they can be kicked off the platform." Further, they don’t decide the price.

American marketing professor Scott Galloway says this far more directly in his 2020 book Post Corona: From Crisis to Opportunity. As he writes: “Uber rents space in other people’s cars, driven by non-employees. The second an Uber car stops making the company a profit, it effectively disappears and costs the company nearly nothing. Revenue can go to zero in a crisis, and Uber can take its cost down 60–80%." While Uber can cut its costs, its driving partners are not in such a position. They have to continue repaying their loans, pay their insurance premiums and spend money on car maintenance. As Galloway writes: “The model is akin to United Airlines telling its flight crews to bring their own 747 if they want to get a paycheck. But it’s a model that works. For Uber."

This is true for many other platforms as well. Of course, given that gig workers are barely organized, collective action is not possible. Also, in a country like India, with a huge youth population and high unemployment, it is always possible to find newer workers willing to work, making collective action difficult.

Platforms in India have largely managed to get around this problem up until now. But moves have been afoot to assure gig workers somewhat better work conditions. Somewhere down the line, if news items on the exploitation of gig workers keep appearing, some state government somewhere is bound to get involved. And if that happens, regulations and unionization could become the order of the day, something that platform managers wouldn’t really want.

In fact, the top management of these firms can learn a thing or two from what happened after Karl Marx made a big prediction in his 1867 magnum opus Das Kapital. When the Industrial Revolution was underway across much of Europe and then later the US, the working conditions of factory employees were far from ideal. And this, among other reasons, led Mark to predict a violent conflict between the working class and capitalists.

This, Marx believed, and as Yuval Noah Harari writes in Homo Deus: A Brief History of Tomorrow, would end “with the inevitable victory of the former and the collapse of the capitalist system." But nothing of that sort happened. As Harari writes: “Marx forgot that capitalists know how to read… Capitalists in countries such as Britain and France strove to better the lot of the workers."

Platform managers today could learn from this and strive to improve the lot of their gig workers by taking initiative before a government comes up with regulations forcing them to do so. At the moment, given the environment, this is the smart thing to do. Money should not be a problem for them, given the endless capital they have access to.

To conclude, for all the technology platforms may have, it’s ultimately humans who make these platform companies work.

Vivek Kaul is the author of ‘Bad Money’.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our App Now!!

Edit Profile
My ReadsRedeem a Gift CardLogout