Alexandrea Ravenelle explored the dark side of the freelance economy in her book Hustle and Gig, which looked at the exploitation that many self-employed workers suffered in an emerging sector of the economy. In her new book Side Hustle Safety Net: How Vulnerable Workers Survive Precarious Times (University of California Press), Ravenelle, and assistant professor of sociology at UNC-Chapel Hill, tackles the lack of a social safety net for freelancers, drawing on the lessons from the pandemic, when, for the first time, some of the estimated 60 million freelancers in the U.S. were able to tap into unemployment insurance in a significant way. Ravenelle, also a Faculty Fellow with the Center for Urban and Regional Studies (CURS), and a 2023-24 Russell Sage Foundation Visiting Scholar, recently shared some insights from her research, which drew on interviews with 199 gig-based workers. Here is an edited excerpt from our interview.
Professor Alexandrea Ravenelle does a deep dive into the implications of providing easier access to … [+]
Elaine Pofeldt: What prompted you to write this next book? Were there any learnings from the first one that made you realize there was more to explore?
Alexandrea Ravenelle: When Hustle and Gig came out, it was all focused on the experience of working in the gig economy—the exploitation, the financial risk, the risks of sexual harassment, the risk of being involved in criminally questionable activities. Then, when COVID hit, I knew that these workers were already vulnerable, already on the edge. Now, if you had to be out working face-to-face with other people, your life was literally in danger, your health was at risk doing that, and so I wanted to know what the experience is going to be for these workers. I was in New York at the time, hearing the sirens when I was walking my dog and discovering there was a refrigerated morgue parked across from the park where we do our dog walks.
I was lucky enough to get a National Science Foundation grant to start interviewing people. We interviewed 199 gig-based, low-wage workers beginning in April 2020. We were one of the first groups to really jump into interviewing these workers. I wanted to know if it was going to be different for workers to be in a pandemic if they were W2 status or 1099 status. How does that affect your ability to get unemployment and affect your ability to make it through the pandemic, to feel you have choices about what to do in your career and what comes next?
Alexandrea Ravenelle, author of “Side Hustle Safety Net.”
Elaine Pofeldt: What were some of the outcomes of that research?
Alexandrea Ravenelle: We found that some really fascinating things happened around unemployment. With the CARES Act, everybody who was unemployed could get unemployment assistance. Supposedly 1099 workers could get unemployment for the first time ever, but one thing that was really surprising is the number of workers that we interviewed who did not want to go on unemployment. They thought it was stigmatized. They thought it was “not for people like them, not for people who work,” which is kind of funny because you only get unemployment if you have worked.
There were a number of people who were in the United States who had green cards work visas and everything but didn’t want to go on unemployment. They thought they would be deported as a result.
We also found that a lot of people had struggles getting unemployment assistance, and it took them weeks and even months before they could get the help—but on the flip side of that, for the workers who got unemployment assistance, their lives were changed. They were able to take time to rest, to reset, to relax, to rethink what they wanted in their careers. They ended up returning to school.
Elaine Pofeldt: Can you share some examples?
Alexandrea Ravenelle: One woman who had been a bartender for years ended up leaving bartending and becoming a dental assistant. As she put it, she never thought she was good enough for a nine-to-five job. She was working at a bar where people were yelling at her and telling her she’s an idiot and all of a sudden she had this opportunity to really think about what she wanted to do, became a dental assistant, decided that she loves it and is now going back to school now to get her degree.
With the unemployment money coming in for about 18 months, some gig workers had the time to build business plans. One guy actually went from dog walking on gig platforms to starting a dog boarding business that by 2021 was making $20,000 a month.
Elaine Pofeldt: So what are your takeaways from all of the interviews you did?
Alexandrea Ravenelle: One major take away is that we should open up unemployment assistance to gig workers, not just during a crisis. Gig workers should have an opportunity to get unemployment assistance. In many ways they’re experiencing the same level of vulnerabilities as W2 workers, more so even. They can be deactivated for any reason. They also are paying for things out of their own pockets and end up more financially vulnerable.
We should also increase unemployment insurance. One thing that people often don’t realize is that unemployment it is not pegged to inflation and so oftentimes unemployment is actually shrinking relative to people’s previous wages. When unemployment was created back in the 1930s, it was supposed to replace about 50% of people’s income and now it’s replacing close to about 40%, and that’s if you can even get it. In a lot of states it’s incredibly difficult to get unemployment assistance, and the cost of living is higher than ever before.
One thing people don’t realize is that for unemployment, the weeks that you’re getting has also shrunk in many places since the Great Recession. This was one of the reasons why the CARES Act had to be so big—because so many states have been slashing their unemployment assistance. So the secretary of Labor recommended everybody gets 26 weeks.
Elaine Pofeldt: So what is what is preventing government from building on what was learned from the CARES Act?
Alexandrea Ravenelle: One of the major factors is that people are often concerned that you give people money that somehow they won’t want to work anymore—and if COVID taught us anything, it was that people really do still want to work. I can’t tell you how many workers I’ve interviewed who searched for jobs throughout the entire pandemic. These are low wage workers, and the jobs they’re searching for are not great.
The other thing that has happened is that a lot of times states want to seem very business friendly. In order to look competitive and appealing to companies, they will try to make their unemployment taxes as low as possible, which gives them a shortfall in their unemployment insurance funds—and then when we have a recession or large-scale unemployment, they don’t have as much money to get to people.
Elaine Pofeldt: With freelancers, we are both the employee and the employer on our taxes, so how would it work for freelancers if unemployment taxes were raised to cover the shortfalls you’re describing?
Alexandrea Ravenelle: We could have funds that a 1099 workers could contribute into and then draw from later on. In Canada, for instance, 1099 workers qualify for unemployment assistance, but they do need to contribute into it. After a year of contributing, they can make claims against it.
Elaine Pofeldt: When people read the book, what are you ultimately hoping for them to take away?
Alexandrea Ravenelle: I’m hoping that they take away an awareness of how important unemployment assistance is, how important has been historically, how important it remains and how it can really change people’s lives if they are given money when they are down on their luck that allows them to keep their lives going and maybe take some time to think about what they want to do in the future.
