Working via Internet Platforms Presents Opportunities and Risks for Employees

Often referred to with buzzwords like “crowdworking” or the “gig economy”, working via internet platforms is currently a subject of public debate. Examples include the ride service app Uber or the tagging of images on a platform like Amazon Mechanical Turk. The prevalence of this type of employment, where services are issued and in some cases carried out via online platforms, is, however, currently extremely low. Furthermore, on the basis of existing research findings, it is still difficult to assess whether the opportunities of platform-based working outweigh the risks. These are the findings of a recent study carried out by the Centre for European Economic Research (ZEW) in Mannheim on behalf of the German Federal Ministry of Labour and Social Affairs.

ZEW researchers analysed the findings of more than 100 German and international research papers in order to create a picture of current research and knowledge on platform-based employment. In addition to the prevalence and working conditions of this type of employment, the study also looked at methodical aspects to evaluate the existing research on the subject.

“The majority of the studies conducted in the US and in Germany suggest that currently less than one per cent of the working population are working via online platforms,” explains Dr. Michael Maier, a researcher in the ZEW Research Department “Labour Markets, Human Resources and Social Policy” and co-author of the study. The findings of the study also showed that the majority of workers only occasionally offer their services via online platforms, meaning that this does not represent their primary source of income. However, a number of papers also found that some workers expressed a desire to work online more frequently. That being said, rating systems used by some platforms can make it hard for newcomers to get a foot in the door, with clients giving preference to more established workers.

Comprehensive public data sources on crowdworking are still hard to come by

People who work via internet platforms differ from the general working population in that they are comparatively young and highly educated and are more likely to be unemployed. According to existing research, the average pay for work on these platforms can fluctuate considerably. Pay is also linked to the type of work offered, which is extremely varied and can range from rather straightforward tasks that can be completed in a matter of seconds to highly complex IT or design projects. In addition, experts are currently debating whether the greater flexibility offered by platform-based working outweighs the associated risks. “Workers on online platforms are essentially self-employed since they are not employed by the platform and in some cases have to compete with workers from all over the world for assignments. However, being self-employed does offer workers the possibility of being more flexible in terms of what time of day or which days of the week they work, and sometimes even where they work,” says Maier.

The ZEW researchers’ analysis also shows that the research papers they looked at used a vast array of different datasets and analytical methods, meaning that existing research into working via internet platforms can still only be described as fragmented. This is primarily due to the fact that there is currently very little information on platform-based employment available in comprehensive and publicly accessible data sources. As a result, many of the research papers included in the study only consider data from a single platform operator, making it difficult to compare the results to those of other studies. In some cases, access to this data, which is usually gained with the platform operator’s consent, may come with the condition that only results that coincide with the interests of the operator may be published.

For further information please contact

Dr. Michael F. Maier, Phone: +49 (0)621/1235-307, E-mail: michaelf.maier@zew.de