How would you like to live in an economy where robots do everything that can be predictably programmed in advance, and almost all profits go to the robots’ owners? Meanwhile, human beings do the work that’s unpredictable – odd jobs, on-call projects, fetching and fixing, driving and delivering, tiny tasks needed at any and all hours – and patch together barely enough to live on. Brace yourself. This is the economy we’re now barreling toward.
Airbnb recently announced it would collect and remit hotel taxes from its users in Washington, D.C., as part of a broader move to resolve tax conflicts — should hosts pay them? how do they pay them? — in some of the company’s largest markets. The move highlights a larger shift in the the “sharing economy,” where thousands of people are now earning income off their second bedrooms, personal cars or spare time. Namely: Companies like Airbnb and Uber are increasingly taking on some of the roles that have traditionally belonged to government.
Airbnb, which just surpassed 30 million guests to use the service at the end of last month, is taking over the vacation rental market at a breakneck speed, stealing customers from public companies HomeAway, Priceline and TripAdvisor. Priceline shares, one-time darling of the bull market, are down 12 percent over the last year. Shares of HomeAway, an online vacation rental marketplace, and TripAdvisor, an online travel research company, are also down more than double-digits over the last 12 months.
In the UK, the British Hospitality Association (BHA) is concerned that the government is planning to deregulate the industry, effectively dismantling the hotels’ monopoly on accommodation in the leisure market. The BHA recently released a statement in which it expressed its belief that the government is “looking towards very prominent, sweeping deregulation, across various industries for the benefit of a few companies, at the cost of consumer safety, job growth, market stability and community interests.
Customer reviews are a new form of credit report, one that measures comportment instead of finances. Although such ratings have been tried before — eBay was a pioneer — the practice has taken off with the rise of the so-called on-demand economy. Reviewing customers is also raising questions about who owns the data detailing good and bad behavior, what they can do with it — and whether people even know it is being collected.
In TIME’s new cover story, Joel Stein takes readers on a wild ride through the sharing economy—renting out his car, chauffeuring people around late into the night, making dinner for strangers and even toying with the idea of doing other people’s laundry. Here are five big takeaways about why we trust strangers with our stuff, our lives and our homes.
One of the little understood realities that come with the quote-unquote “sharing economy,” or when ordinary people offer up space in their cars, their bicycles, and in Airbnb’s case, the place where they sleep (or perhaps don’t), for additional income is that assuming a 25% tax bracket and 15.3% self employment insurance, some people will be owing upwards of 40% of what they earned in Federal taxes.
The San Francisco Democratic County Central Committee on Wednesday night is set to vote on a resolution authored by State Sen. Mark Leno, Supervisor David Campos and Meagan Levitan demanding that Airbnb immediately pay its back taxes, estimated at $25 million. As with a lot of what the DCCC does, passage wouldn’t actually do anything, but it would send a message.
It’s true that, in many ways, sharing-economy jobs can offer more autonomy than traditional employer-employee relationships. But there’s a dark side to these work arrangements that gets considerably less press: the shifting of risk off corporate balance sheets and onto the shoulders of individual Americans, who may not even realize what kinds of liabilities they’re taking on.
Skyrocketing rents in San Francisco are forcing radical change to the city’s social fabric, and new research from a community housing group seeks to pin part of the blame on the so-called “sharing economy.” The Anti-Eviction Mapping Project (AEMP) has published a map of Airbnb and VRBO rental listings that illustrates the sites’ huge influence in the city.