Good Work Innovations for Non-Standard Workers in Europe and Sub-Saharan Africa
By Emma Morgante, Future of Work Programme, The Royal Society for Arts, Manufacture and Commerce (RSA)
Non-standard workers face multiple challenges to accessing good work. Securing good work for all is the aim of the RSA Future of Work Programme. In this context, together with the Autodesk foundation, we embarked on a period of research to understand and highlight the good work innovations that are emerging in answer to these challenges. We hope here to provide the context in which these initiatives operate, and to showcase the innovative solutions that they are providing.
The landscape of the future of work in Europe and Sub-Saharan Africa
Context matters for the future of work. Factors such as demographic change, sectoral composition, automation risks, technological advancements and labour market trends all shape the path of the future of work in different global regions and across different countries and realities. This holds particular relevance for the issues affecting non-standard work.
Across Europe we found that in recent decades the social contract between workers and businesses has frayed. Indeed, we have seen a rise of insecure work and non-standard work. While data is still unable to capture the full extent of the gig economy and non-standard work, a 2017 study by the University of Hertfordshire showed that 9 percent of workers in Germany and the UK, and 22 percent in Italy have engaged in some form of online gig work. The percentage of people earning the majority of their income through these platforms, however, is much lower — less than 3 percent in Germany and the UK and around 5 percent in Italy.
Platforms and gig work, however, do not represent the whole picture. Indeed, the OECD have warned against over focussing on the platform economy at the expense of other types of non-standard work that suffers from the same types of insecurities and lack of social protections. For example, while gig work certainly suffers from one sided flexibility that leaves workers with unstable futures, the prevalence of temporary and fixed-term contracts also leaves workers with insecure tenure and can easily be fired. Fixed term employment has been particularly marked in some European countries like Italy, the Netherlands, Poland and Croatia. Zero-hour contracts, additionally, leave workers with no minimum guaranteed hours at all.
The self-employed also face significant challenges, relating to economic security and lack of important protections that benefit workers in conventional employment arrangements. Indeed, across Europe, more than half of all self-employed workers are ineligible for unemployment benefits, 38 percent are ineligible for sick pay and 46 percent cannot access maternity or paternity benefits. In this context, the RSA has been calling for creating parity of esteem between non-standard and standard workers.
The landscape in Sub-Saharan Africa is characterised by the high employment share in the informal and agriculture sector. Across the region, informal and non-standard work is the norm and around 50 percent of workers across the region are employed in agriculture, although these numbers differ widely between sub-regions. In urban centres, the majority of work is concentrated in microbusinesses that operate under the radar of the government. Examples of urban informal work include street traders, food vendors, transport drivers and craft workers. In some countries outside of Southern Africa, informal work accounts for as much as 80 percent of employment, even though this is declining over time (RSA analysis of World Bank Development Indicators).
Many highlight the dynamism of the informal sector, which has been shown to be resilient in periods of turbulence, including economic downturns. However, this hasn’t happened in the latest crisis caused by the pandemic, and informal workers have been hit particularly hard.
The answer, however, cannot currently reside in formal job creation, as it is widely recognised that this has not been able to keep up with the speed of population growth in the region. Across countries in Sub-Saharan Africa, indeed, the population is growing rapidly and is increasingly younger, although once again there are great variations between countries. By 2050, Africa is predictedto be the only region with a growing working age population.
The relationship between informal sector and the gig economy is in this sense interesting. Gig work can be seen in this context as providing a level of formalisation for informal workers. Amolo Ng’weno and David Porteous of the Centre for Global Development call for recognising the role that informal sector and the gig economy play in the region and building on that to provide good work opportunities for everyone. However, working on platforms does not ensure access to good work. Indeed, the Fairwork Foundation found that platforms have not done enough to support workers in South Africa during the COVID-19 crisis. While in 2017 Uber drivers in Nigeria protested against a reduction of fares the impact of which was being unfairly passed on to drivers.
Good work innovations
In our analysis we set out to identify the innovations that are clustering around some of the most pressing future of work challenges in their contexts. Our approach builds on the Future Work Awards, a global innovation competition, that the RSA ran in partnership with ALT/ Now, Social Capital Partners and Barclays LifeSkills in 2018–19.
Across the different types of innovations, we were particularly interested in innovations that address diversity and inclusion, opening up good work to people on the margins of the economy. Many of these initiatives address non-standard work both in Europe and in Sub-Saharan Africa. Our hope in highlighting these groups of innovations is to support innovators, policy makers and social investors to spot opportunities for new ways to support workers.
In highlighting the values of social innovations, we do not however want to ignore the difficulties of scaling new ideas and incur in the dangers of solutionism. While the innovators themselves are providing fundamental services to their users, they will need to shape and be shaped by the regulatory and institutional landscape of their countries before they can have lasting impact on people’s working lives. Further, in Sub-Saharan Africa we have highlighted how in order to scale, innovations will need to be complemented by other measures such as government policy and physical infrastructure.
Benefits and social protection
In Europe, we found that an innovative solution that has the potential to provide much needed support to non-standard workers is the introduction of a system of portable benefits, which would give all self-employed workers access to a range of non-statutory employment protections. Unlike the current model across Europe, a portable benefits system would ensure that once benefits are accrued, they are retained by workers even if they move across jobs or become unemployed. This could work well with workers that might move across different gig economy platforms.
The need for such a system was highlighted early on in the COVID-19 pandemic. In the UK, gig workers had no access to sick pay and were initially advised by a minister at the Department for Work and Pensions to claim unemployment benefits instead. As many workers could not afford to self-isolate without sick pay, this may have worsened outbreaks. While temporary measures were then introduced in many countries across Europe, there remains a need to radically reform the system.
Some innovators in Europe are attempting to develop portable benefits solutions. For example, Collective Benefits partners with gig economy platforms to give their workers access to a tailored package of benefits that can include sick pay, family leave and holiday pay.
A lack of a system of social protection for both the informal and the platform economy is an issue in Sub-Saharan Africa as well. Countries’ policies typically target social protections at formal employees, meaning that vast sections of the population are left out. Indeed, research by the OECD shows that, for example, in East Africa, only in Kenya coverage exceeds 10 percent of the working population.
One innovation that is trying to approach the issue is Perks. Perks was born as a benefit aggregator for self-employed and on demand service providers. It was set up by Qhala and supported by the Frontier Technologies Livestreaming Programme and the UK-Kenya Tech Hub. The initiative embarked on a period of user research to truly understand the benefit needs and priorities of workers at different stages of their gig work journey. They found that gig workers mostly see themselves as micro business owners and are thus prioritising products that sustain the business (the gig). Interestingly, health insurance and pensions were found to be less important, as networks of family and friends can function as an alternative safety net.
Economic Security
One way in which innovators in Europe are trying to support non-standard workers is by improving their economic security, for example by providing income-smoothing tools. This is particularly important for gig economy workers and those on zero-hour contracts, 45 percent of which face high income volatility, according to a 2019 RSA survey. Trezeo, for example, is an income smoothing bank account that provides interest-free income smoothing. It uses machine learning to understand income patterns and model risks. Other initiatives facilitate access to credit, such as Mansa in France.
Innovators are also exploring how to allow non-standard workers, alongside self-employed people, to access employment protections usually granted to employees, in the form of insurance. The provision of sick pay and healthcare insurance has been particularly important during the pandemic. InsurTech start-up Indeez, for example, launched its new product CoviSure, which provides income replacement to workers that cannot work due to a COVID-19 infection.
In Sub-Saharan Africa, we have found similar innovations that work specifically in the context of agriculture. Innovators across the region are supporting workers to, among other things, digitise their transactions and participate in the formal economy. M-shamba, Tulaa and Agri-wallet are all innovations that provide access to markets, loans and finance. Tulaa, for example, enables smallholder farmers to access inputs, credit and markets in Kenya by connecting them su suppliers, buyers and banks through mobile technology and AI. In Kenya, Agri-wallet provides supply chain finance so that all actors in the agricultural value chain can access financing o grow and scale. Further, they offer insurance products to safeguard against weather shocks, providing much needed stability. Releaf in Nigeria is a logistics platform that also provides interest-free financing to farmers to access equipment to automate manual tasks, at the same time building transaction histories.
Worker voice
In Europe, social innovators are further focussing on increasing worker voice, including for non-standard workers. This is particularly important in a context of decline of institutional worker voice, including in the role that trade unions play in governing labour markets, with many countries are experiencing a long-term decline in membership.
In response to these trends, we have identified in Europe various innovations in the field, many of which can support non-standard workers. Unions are experimenting with new organising models. In the UK, the Independent Workers’ Union of Great Britain (IWGB) introduced a devolved model to effectively represent its member base, mainly low-paid migrant workers, many of whom are employed in outsourced services or the gig economy. Further, more traditional unions are expanding their membership offer to non-standard or insecure workers, like the GPA-djp — the largest trade union in Austria — which extended its membership to crowdworkers.
Platform coops are also being used as a cooperatively owned and democratically organised way of brokering the provision of goods and services, often as an alternative to gig platforms. In the UK Equal Care Co-op aims to establish a more equal relationship between care givers and receivers. Cooperative that are led by and made for couriers formerly working on gig platforms exist include KOLYMA2 in Germany and Mensakas in Barcelona, Spain.
Our innovation mapping exercises in Sub-Saharan Africa was challenged by a relative lack of evidence of cluster of worker voice organisations concentrating on non-standard workers. The field however presents high potential for increasing the agency and empowerment of workers, especially those in more insecure work such as in the informal economy. Further research is here advised and desirable, and we hope that social innovators and social investors find here an opportunity to focus efforts.
Fairer platforms and impact sourcing
Despite the issues with platform work that have been highlighted, including regarding job quality and access to social protection, some platforms are introducing impact sourcing, which refers to when platforms outsource jobs to otherwise excluded people. We identified a range of “fairer platforms” doing this for groups such as senior workers in the case of Seniors@Work, which helps retired workers find one off projects, part-time or hourly work. Labour Xchange, instead, allows underemployed people and home carers to find employment that they can fit around other commitments, that is paid at least the living wage and that benefits from the income smoothing services of innovations such as Trezeo, mentioned above.
In Sub-Saharan Africa, this is happening particularly in the field of low-level tasks behind AI systems, such as data entry, labelling and coding. These tasks might not currently consistently provide good work but can be seen as a ladder to more stable opportunities.
One example of these types of innovations is Sama, where workers label and tag training data for AI systems. Employment provided is formal, and the benefits that workers have access to are the same in San Francisco and in Uganda and Kenya, and skills provision is prioritised. Another platform doing impact sourcing is Cloud Factory, which aims to create meaningful work for as many people as possible and build leadership and digital skills. It pay in US dollars, increasing the stability of earnings. Indeed, according to an interview with an expert stakeholder, the currency fluctuations for example in Nigeria, meant that young people who work on digital platforms and are being paid in foreign currencies often earn more than people in formal employment. This, however, creates a system in which there might be a trade off between higher earnings without employment protection on a platform, and the stability and perks of a formal job.
Conclusion
Our analysis highlighted the issues that non-standard workers are facing both in Europe and Sub-Saharan Africa. One of the most pressing issues is the lack of social protection for non-standard work, including that on carried out on gig economy platforms. In Europe, this lack was felt particularly during the COVID-19 pandemic. In this context, however, there have been some signs that platforms were in a sense forced to ‘grow up’, as the pandemic accelerated discussions around increased protection for workers. One example is food delivery platform Just Eat, which announced it would provide access to pension contributions and sick pay and hire its drivers as employees on hourly contracts. Indeed, research by the Fairwork Foundation, for example, shows that several platforms introduced a wide range of protective measures including health insurance and financial support. Non-standard workers also received temporary support by several states across Europe, but this only highlighted the need for a longer term coherent system that provides a safety net in times of transitions and crises.
In Sub-Saharan Africa, platforms might provide a level of formalisation to informal workers. However, the lack of social protection remains an issue that should be approached also at a systemic level. The problem is exacerbated by structural problems that platforms face that mean that they are sometimes not viable in the long run. An example is that of Safeboda, a boda boda driver platform, that entered the Kenyan market and then failed. This leaves workers even more vulnerable to market forces. As a stakeholder mentioned in an interview, “it is insufficient to pretend that more Ubers, Jumias or Sweep Souths [e-commerce platforms] will solve the problem. […] at the end of the day, we’re at the mercy of the market rather than directing the market to serve society”.
Our work aimed to showcase the important work that is being carried out by social innovators to address the challenges around good work, especially for non-standard workers. This is done in the context of changing contexts and trends like those just mentioned around platforms. For this reason, the work of social innovators needs to be complemented and supported by system-level solutions that can ensure that initiatives can grow and scale and have a lasting impact on people’s working lives.
The opinions and views expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of Reshaping Work.
