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Almost 1 in 4 of the Louisiana workforce, counting gig workers, are filing for unemployment | Business News

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Recent news analyses have sketched out a dire picture of the scope of the jobless crisis in Louisiana and the extent of the expected damage that the state’s economy as the federal boost to unemployment benefits lapses.

But the true picture is actually worse than some of those reports have outlined. For instance, a Sunday story in The Times-Picayune | The New Orleans Advocate noted that more than 313,000 laid-off Louisianans had filed for state unemployment benefits as of July 18, the most recent data for which the state provided complete data. But that figure didn’t include the thousands of freelancers, independent contractors and so-called “gig” workers thrown out of jobs by the coronavirus crisis.

That latter group includes more than 152,000 out-of-work Louisianans who, although not normally covered by the unemployment insurance system, have been able to file for jobless benefits under a special federal expansion of the program to address the massive job losses during the pandemic.

A major lifeline of federal aid to more than 300,000 laid-off Louisianans during the coronavirus crisis, the extra $600 federal boost to every…

Added together, that works out to about 465,000 out-of-work Louisianans — or nearly a quarter of the state’s total labor force — who have filed continued claims for unemployment benefits. All are now in line for a $600-per-week cut in income after the federal boost to unemployment, passed by Congress in March, expired at the end of last week. For most of those people, that will be a loss of at least 70% of their income.

The now-expired $600 federal boost to benefits injected a total of as much as $270 million each week into the Louisiana economy.

“It’s an enormous income loss that has started now,” said Jan Moller, executive director of the Louisiana Budget Project, a left-leaning nonprofit that advocates for working Louisiana families. “There are not half a million jobs for people to go back to. Not even remotely close.”

While the data suggest nearly 1 in 4 working Louisianans is about to take a major financial hit, that pain won’t be spread evenly on a geographic basis. A March analysis by the Brookings Institution predicted that New Orleans would be the third-hardest hit of 106 large U.S. metro areas, thanks largely to the city’s dependence on tourism.

As predicted, the pandemic prompted a freefall in air travel, led to the cancellation of numerous major festivals and conventions, and forced bars, restaurants and hotels — the biggest employers in the area by far — to dramatically scale back operations or shutter entirely.

Later this week, hundreds of thousands of Louisianans who lost their jobs in the pandemic will see their unemployment benefit checks slashed b…

As of June, the latest figures available, the number of total jobs in the New Orleans area was down 13.7% from February levels. Those numbers were down across the state, of course: the drop was 10.5% in the Baton Rouge area and 5.4% in Lafayette, according to the federal Bureau of Labor Statistics. The picture appears to have only worsened since then, at least based on weekly initial unemployment claims, which after falling in May and June began ticking back upward throughout July.

Claims from Orleans, Jefferson and St. Tammany account for nearly a third of the state’s total unemployment claims.

Businesses that cater to travelers now face a deeply uncertain future. The coronavirus’ resurgence has cast doubt over the future of the tourism industry, and a growing number of major employers in that sector — casinos and large hotels — have filed notices with the state warning of mass layoffs, an indication that mass furloughs in March and April are likely to turn into permanent job cuts. The accommodation and food service sectors have seen by far the steepest job losses, both statewide and in the New Orleans area, followed by retail.

“Those two sectors alone count for more than 50% of the job losses that we’ve seen in the last couple of months,” said Gary Wagner, an economics professor at the University of Louisiana Lafayette, during the Acadiana Advocate’s virtual economic outlook panel Wednesday morning.

Workers in the hospitality industry in particular tend to earn lower wages, live paycheck to paycheck, leaving many out-of-work families with little cushion to ride out unemployment. While some in this sector actually got a brief boost in pay from the $600 weekly unemployment supplement, they’re unlikely to have much in the way of savings to draw on when that stipend is cut.

“It’s going to have a generational impact on a lot of households,” said Moller.

Hundreds of thousands of Louisianans who’ve lost their jobs during the coronavirus pandemic have continued to receive sizable weekly checks, t…

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Workers

Gig economy workers demand fair conditions

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James Yang is still angry over the road deaths of five colleagues at work who suffered the same pressure he felt as a food delivery driver.

The Chinese migrant worked for Hungry Panda but says the company booted him off the app after raising concerns about conditions.

Mr Yang earned as little as $12.50 an hour working 12-hour days.

He and fellow gig economy workers met with politicians at federal parliament on Thursday, campaigning for the same rights afforded to other workers.

Labor leader Anthony Albanese believes gig workers should be given the minimum wage and greater scope to access other base employment standards.

He urged the Morrison government to stand up to Uber and Hungry Panda in the same way it took on tech giants over the news media bargaining code.

“What we can’t have is a circumstance whereby we have two industrial relations systems,” Mr Albanese said.

“One that has pay, one that has annual leave, sick leave, one that has conditions that most Australians take for granted, and another whole section of society who are marginalised, who don’t enjoy any minimum wage.”

Industrial Relations Minister Christian Porter said he had a great deal of sympathy for Mr Yang but he’s not going to tell him there’s an easy fix.

He said the Fair Work Commission had consistently ruled gig workers were contractors and not subject to the same conditions as employees.

Mr Porter said media code negotiations with Facebook and Google were years in the making after a consumer watchdog inquiry.

He noted the cost to business of changing the gig model and impact on consumer pricing as key complexities in regulating the sector.

Rideshare driver Malcolm McKenzie said gig workers didn’t have the same avenues to pursue unfair dismissal.

“Drivers face the possibility of termination through the app as a result of a fallacious claim against them, unsubstantiated claim against them,” he said.

Delivery driver Ashley Moreland said he faced losing his job if orders weren’t met on the company’s timeline.

“It really is time that laws caught up to the technology and that we brought some rights to this industry,” he said.

“Because I think it’s a bit of a shame that in a modern developed democracy, we have this situation of third world work.”

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Gig workers to form 20% of finance workforce in next five years

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More than half (52%) of financial institutions say they expect to have more gig-based employees in the next three to five years, according to PwC’s report, ‘Productivity 2021 and beyond: Upskilling the workforce of the future to create a competitive advantage in financial services’.

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Gig economy to supply fifth of financial services workers by 2026

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Up to a fifth of workers in financial services could be gig economy employees within the next five years globally, new research by PricewaterhouseCoopers suggests (PwC).  After surveying 500 financial services businesses, the researchers found that slightly more than half expect to have more gig-based employees – such as online platform workers – over the next three to five years.  The gig economy currently supplies just 5% of talent in financial services, but PwC expects this to rise to between 15% and 20% by 2026, driven by continuous cost pressures and the need to access digitally-skilled talent.  Crowdsourcing – which typically involves using the internet to divide work between many different participants – was also highlighted as a key contributor to improve productivity by the survey respondents.  Half of businesses said they had leveraged the practice, up from 21% in 2018, of which 80% said it had added “high value” to their organisations.  John Garvey, global financial services leader at PwC US, said that COVID-19 and remote working have “opened the door to accessing talent outside of a firm’s physical location”, including outside of the country.  “What we are seeing now is a talent marketplace for gig workers in financial services, competing to take advantage of their specialist skill set and boost productivity within their businesses,” he continued.  “Leaders in the industry are looking seriously at their workforces to evaluate which roles need to be performed by permanent employees and which can be performed by gig-economy workers, contractors or even crowd-sourced on a case-by-case basis.”  However, challenges remain for financial services businesses wishing to take on gig workers, which will require overcoming several obstacles.   The survey found that the most common issues for businesses include confidentiality concerns, a lack of knowledge, regulatory risk, and overall risk avoidance.  Garvey said that few full-time employees and an increasing percentage of gig-economy talent and skills that they

Up to a fifth of workers in financial services could be gig economy employees within the next five years globally, new research by PricewaterhouseCoopers suggests (PwC).

After surveying 500 financial services businesses, the researchers found that slightly more than half expect to have more gig-based employees – such as online platform workers – over the next three to five years.

The gig economy currently supplies just 5% of talent in financial services, but PwC expects this to rise to between 15% and 20% by 2026, driven by continuous cost pressures and the need to access digitally-skilled talent.

Crowdsourcing – which typically involves using the internet to divide work between many different participants – was also highlighted as a key contributor to improve productivity by the survey respondents.

Half of businesses said they had leveraged the practice, up from 21% in 2018, of which 80% said it had added “high value” to their organisations.

John Garvey, global financial services leader at PwC US, said that COVID-19 and remote working have “opened the door to accessing talent outside of a firm’s physical location”, including outside of the country.

“What we are seeing now is a talent marketplace for gig workers in financial services, competing to take advantage of their specialist skill set and boost productivity within their businesses,” he continued.

“Leaders in the industry are looking seriously at their workforces to evaluate which roles need to be performed by permanent employees and which can be performed by gig-economy workers, contractors or even crowd-sourced on a case-by-case basis.”

However, challenges remain for financial services businesses wishing to take on gig workers, which will require overcoming several obstacles. 

The survey found that the most common issues for businesses include confidentiality concerns, a lack of knowledge, regulatory risk, and overall risk avoidance.

Garvey said that few full-time employees and an increasing percentage of gig-economy talent and skills that they can access on-demand, are making organisations far more innovative, nimble and cost-efficient.

“Many of the most valuable companies in the world share one thing in common: they have embraced the platform economy as a business model,” he added.

 

Image credit: iStock

Author: Chris Seekings

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