Gig Economy Growing in Wisconsin, Despite Early Pushback

Independent contractors, temporary employees, and other so-called “contingent” workers make up a growing share of the American workforce. According to a 2015 report from the Government Accountability Office, contingent workers accounted for 40.4 percent of employed workers in 2010, up from 35.3 percent in 2006.

In Wisconsin—and elsewhere—companies that make up the “sharing” or “gig” economy are forming and expanding. However, some parts of the sharing economy are not being embraced with open arms, and there are lingering questions related to the classification and rights of workers who “gig.”

fThe sharing economy, while somewhat difficult to define, is likely larger than most people realize. A 2016 study by the Pew Research Center found that 72 percent of American adults had used at least one of 11 shared or on-demand online services. Many of these services, such as ride-hailing apps and grocery delivery, involve a gig worker. However, Pew also considers transactions like buying secondhand items on Craigslist—a website that was popular long before the era of Uber and Airbnb—to be part of the sharing economy.

Most people are familiar with consumer-facing businesses in the gig economy. But the field also has a lesser-known, business-to-business side, says Kevin Kiser. He’s head of brand strategy and communications at Bunker, a San Francisco-based startup that opened an office in Madison, WI, last year. The company’s software helps businesses that hire freelancers verify that they have current and proper insurance policies—covering workers’ compensation, for instance—for the type of work they’re brought on to do.

“Independent contractors are vast,” Kiser says. “We’ve found there’s a lot of pain in managing that continued workforce. We provide software to enterprises or staffing agencies for them to manage insurance for all their independent contractors.”

Bunker, which launched in 2015 and counts Madison-based American Family Ventures among its investors, also helps freelancers purchase new policies if they don’t have the right coverage for a particular job, Kiser says.

Bunker is an example of a company that aims to make life easier for gig economy workers and organizations that use them. Most of the controversy around the sharing economy in the past several years, meanwhile, has centered around consumer-facing services like Uber and Airbnb. Specifically, there’s been a fierce and wide-ranging debate over whether such companies should be welcomed or shunned upon entering new markets.

One local flashpoint occurred in 2014 as a result of Uber and ride-hailing rival Lyft coming to cities in Wisconsin, including Madison. The city’s mayor, Paul Soglin, opposed the companies’ right to operate in the city, in part because they were not subject to the same regulations as taxi companies, which have to do things like provide round-the-clock service. Those objections were rendered moot in 2015, when state lawmakers passed a law that exempted Uber, Lyft, and their competitors from most of the regulations that govern other transportation services.

Still, in Portland, OR, and many other cities across the country, residents continue to express loud opposition over what they see as illegal behavior by gig economy companies. In turn, those companies are becoming more proactive about heading off criticism.

Carrol Chang is a general manager at Uber, where she oversees operations in several Midwestern and Great Plains states, including Wisconsin and Minnesota. She says the perception that Uber’s approach is to enter a new market, build up a loyal base of … Next Page »

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Jeff Buchanan is the editor of Xconomy Wisconsin. Email: jbuchanan@xconomy.com Follow @_jeffbuchanan

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