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Coronavirus will hit gig workers particularly hard



Investors in the gyrating US stock markets might be forgiven for feeling seasick this week. On Wednesday, share prices rose more than 4 per cent after the Super Tuesday primaries and approval by the House of Representatives of an $8bn package to combat the coronavirus outbreak.

It is easy to see the reason for cheer: $8bn is far more than the $2.5bn initially suggested by the White House, and it will be mostly directed to hospitals and medical research. However, before investors become too excited, they should note what is sadly missing in this bill: a commitment to plug the holes in America’s medical and social safety net that have been exposed by the disease, known as Covid-19.

This matters. If these holes go unfilled, and the virus keeps spreading, this could exacerbate the potential economic pain. And, as US Federal Reserve officials know only too well, it is foolish to rely on monetary policy to cushion this blow — notwithstanding Tuesday’s decision to cut rates by 50 basis points.

To understand why America’s weak safety net matters, consider an issue that has sparked hot debate in recent years: the rise of the so-called “gig” economy, in which workers are paid piecemeal for contingent work, often linked to tech platforms, such as ride-hailing and food delivery.

Tracking the size of contingent activity has always been notoriously hard. However, economists estimate that about a quarter of American workers currently do gig work, considerably higher than in previous years, and nearly half of these rely on it as their primary source of income.

In some ways, the gig economy has been positive for US growth: the creation of new tech-related gig jobs has helped to push unemployment down to 50-year lows. It also seems to have kept a lid on wage growth and inflation, enabling the Fed to keep rates low.

But the dark side of this arrangement is insecurity. Contingent compensation is unpredictable. Gig workers generally lack access to company-funded unemployment insurance, sick pay and medical benefits. In Europe, this is offset by public safety nets; not so in America, for the most part.

Well-paid gig workers, such as software engineers, can cope with this insecurity by purchasing private insurance. But many gig workers are low paid and sacrifice this to join the pool of 27.5m Americans who lack health insurance. Others buy cheap policies that require them to pay the first several thousand dollars of medical bills themselves.

This creates obvious medical risks with the coronavirus. The cost of testing and treatment will deter some Americans from seeking care if they fall sick. Tales of sky-high bills are buzzing in the media. A Miami man says he received a $3,270 bill for a voluntary coronavirus test; an American evacuated from the outbreak’s epicentre in Wuhan China received a $3,918 bill for mandatory quarantine in San Diego. The lack of sick pay may encourage unwell gig workers to keep working. And many low-paid gig jobs cannot be performed at home. Delivering a pizza or driving an Uber car still requires a human.

If the coronavirus sparks a lasting downturn in travel, tourism and the retail sector, it will hit low-paid contingent workers particularly hard. Indeed, United Airlines cut domestic flights by 10 per cent and the threat of more could shatter confidence. This matters in a country where so many households live pay cheque to pay cheque that nearly one-third of American families could not meet an emergency $400 bill from existing resources.

What can be done? Congress could make coronavirus testing and quarantine, and perhaps treatment, free for all US residents who lack insurance. New York state has taken a first step by waiving co-payments for testing. But much more is needed. Laurence Boone, chief economist at the OECD, has suggested that governments should use “temporary direct transfers” of cash to support vulnerable households, if the virus spreads. That would deliver far more impact and reassurance than the vague pledge of $1bn in loan subsidies to small companies in Wednesday’s bill.

But American leaders must start a proper debate about creating a better longer term safety net for gig workers. California is doing this in a piecemeal and imperfect manner. However, federal action is needed. Congress could start by considering some sensible proposals on portable benefits from senator Mark Warner and the Aspen Institute.

But none of this was included in this week’s House bill. And Fed chairman Jay Powell knows rate cuts are not enough but is wary of wading too directly into policy matters. Therein lies a potential tragedy.

Follow Gillian Tett with myFT and on Twitter

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Iberdrola and GIG in 3.3GW offshore wind push in Japan




Iberdrola has acquired local developer Acacia Renewables and entered into a joint venture with Macquarie’s Green Investment Group (GIG) to develop its 3.3GW offshore wind portfolio.

Prior to the acquisition, Acacia was Macquarie Capital’s Japanese renewable energy platform, according to its website.

Acacia’s portfolio includes two projects with a combined capacity of 1.2GW at a more advanced stage, and a further four with a combined capacity of 2.1GW.

Spanish energy giant Iberdrola and the GIG aim to enter the first 1.2GW batch of wind farms – located off the south-west coast of Japan – in upcoming auctions announced by the Japanese government.

These first two projects could be commissioned by 2028, Iberdrola claimed.

The company said it has set its sights on Japan as a “new growth platform” in renewables, and offshore wind in particularly.

Iberdrola has stakes in operational offshore wind farms worldwide with a combined capacity of just over 1GW, while GIG has backed operational offshore wind projects with a combined capacity of just under 1.3GW, according to Windpower Intelligence, the research and data division of Windpower Monthly

The two companies will both take charge of developing Acacia’s projects.

Acacia had issued public notices of Environmental Impact Assessments for the six sites. These are wind farms called Satsuma, Nanao Shika, Fukui Konpira, Shiroishi Kosugo, Fukui Konpira and Tono.

There is currently just over 40MW of operational wind power capacity installed in Japanese waters, according to Windpower Intelligence.

However, a growing number of developers are targeting the nascent market ahead of offshore wind tenders, which are expected to be opened shortly.

Last week, Equinor, Jera and J-Power joined a long list of partnerships targeting the Japanese offshore wind market, despite the nation’s apparent slow uptake of the technology.

In 2019, the Japan Wind Power Association said that the lengthy process for environmental impact assessment was having an impact on the development of offshore wind.

One of the main obstacles for wind developers in Japan comes from opposition from local fishing communities.

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In Season Of Strikes For Gig Workers, Now Swiggy Delivery Execs In Noida Rebel




After strikes in Chennai and Hyderabad in the last 30 days, Swiggy’s delivery executives in Noida have gone on strike to protest against low wages

The delivery workers are demanding a minimum payout of INR 35 per order and restoration of monthly incentives, among other demands

Similar demands were also raised by Swiggy’s delivery partners in Hyderabad, who went on an indefinite strike last week

With similar demands as their counterparts in Chennai and Hyderabad, delivery executives with Indian foodtech unicorn Swiggy in Noida, on Thursday (September 17), went on a strike to protest against low wages. 

The strike comes just days after Swiggy’s delivery partners went on an indefinite strike in Hyderabad to protest against the low wages and to press their demands. 

In Noida, the protesting delivery workers are demanding a minimum payout per order of INR 35, a minimum payout of INR 20 per batched order (when the driver has to make more than one delivery in a single trip), and a payout at the rate of INR 10 per km after the worker has travelled more than 5 km for making a delivery, among other things.

The delivery partners in Noida, affiliated with the All India Gig Workers Union (AIGWU), have also demanded the reinstatement of monthly incentives of up to INR 3,000 for full-time work and INR 2,000 for part-time work. 

Further, the delivery partners are also demanding extra wages for deliveries made while it rains, or in nights, as also, compensation for waiting time at restaurants, while the order is being prepared. 

“Swiggy delivery workers are taking extraordinary risks by delivering food and essentials to people during this pandemic. The company cannot reward us by cutting our payouts and incentives. Our demands should be met at the earliest,” reads the letter stating the demands of AIGWU for Swiggy’s delivery workers, addressed to Swiggy’s CEO Sriharsha Majety. 

The demands of the delivery workers in Noida are similar to the demands of the workers in Hyderabad, who, earlier this week, launched an indefinite strike to protest against Swiggy paying low wages to the delivery workers. 

The workers in Hyderabad have alleged that during the lockdown, their minimum payout per order reduced from INR 35 to INR 15, while the company also removed monthly incentives to the tune of INR 5,000. 

When asked about the protest of delivery workers in Hyderabad earlier this week, a Swiggy spokesperson told Inc42, “Most delivery partners in Hyderabad make over INR 45 per order, with the highest performing partners making over INR 75 per order. This INR 15 is only one of the many components of the service fee.”

“Naturally, no active delivery partners in Hyderabad have made only INR 15 per order in the last four weeks. It is important to note that the service fee per order is based on multiple factors to adequately compensate our partners including distance travelled, waiting time, customer experience, shift completion and incentives. Regular competitive benchmarking shows that these are at par, if not higher than the industry standards,” Spokesperson added.

In what has been a season of strikes for gig workers, last month, Swiggy’s delivery executives in Chennai had gone on strike to press for their demands. A few days after the strike in Chennai, Swiggy told NDTV that the company had had a positive dialogue with the protesting delivery partners and was back to serving the entire city of Chennai with its fleet of workers.

Meanwhile, the Indian government’s new draft social security code is said to have recognised gig workers, and will mandate gig economy companies to contribute to a social security fund for gig and platform workers, reported Business Standard. Approved by the Union Cabinet last week, the code, which will have several other benefits outlined for gig workers, will come up in the Parliament’s ongoing monsoon session.

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Gig work is risky for apps, too – Hartford Courant




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