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Labor Economics and How Uber is Going to Disrupt Starbucks

The other morning I woke up, bought a coffee at a fancy coffee shop, hopped in an Uber and went to a SoulCycle class.

I started thinking about how in just a few moments, I had bought services from people representing three very different and rapidly changing models of employment—the coffee shop’s hourly scheduled employee, a contract Uber driver and a fitness instructor with a personal following who is paid for her time, but gets a big bonus for filling classes.

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These sort of labor shifts have happened before. The rise of industrial work as higher paying and more flexible than domestic labor hollowed out the market for butlers and home cooks a few generations ago. Maybe in a few years we will look back and see that the world will have effectively turned over again and what is currently traditional employment will be the hollowed out part of the economy.

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Starbucks and others can’t just compete by increasing wages dollar-for-dollar. Lyft and others offer something they can’t: the ability to determine when you want to work