So far, the sharing economy’s impact has been largely unseen because we (and the Bureau of Labor Statistics) are used to counting employment in whole jobs, or part-time jobs, not something-I-do-on-the-side-while-I-freelance jobs. Currently, companies like Airbnb, and Etsy, and Sidecar enable tens or hundreds of thousands of people who are even further down the food chain than “small businesses.” They’re micro-entrepreneurs doing something so nontraditional we don’t even know how to measure it.
"It's like an invisible economy," says Molly Turner, Airbnb’s director of public policy. And companies inside it need to get real sophisticated, real fast in figuring out how to measure this invisible economy, she says, because for many people this looks like an important part of the future of work. It could even be a big component in our understanding of why America's jobs numbers look so lethargic.
"That's not to say Airbnb advocates for counting this as work, or as a 'business,'" Turner says. "But it's a productive economic activity that has a really important impact."
That argument also neatly nests within wider fears that technology is now destroying jobs faster than it is creating them.
The innovation behind many sharing economy companies, however, is that they are making it more efficient to hail a cab, or rent a hotel, or order a wedding cake topper. On the supply side, they’re making it more efficient to provide these services or sell these products. And an increase in efficiency generally leads to an increase in economic productivity, which, generally speaking, translates to economic growth.
Give people a more efficient, convenient, cost-effective way of getting something, and typically the demand for that thing actually goes up. “If something becomes better,” Sundararajan says, “people want more of it, not less.”
In other words, an expansion of consumption possibilities leads to an increase in consumption. This is essentially a story of economic progress, Sundararajan says: new technology leads to more efficiency, which leads to an expansion in production and consumption possibilities. There are substantially more hotel rooms in America today than there were 50 years ago, because people have accumulated more leisure time, more income, more need for business travel.
“eBay’s impact hasn’t been on the thousands of tech jobs it created for eBay,” Sundararajan says, “but on the hundreds of thousands of sellers it created.”
That’s where the real economic impact here lies, and it’s not actually clear if all of those people – Uber drivers, Etsy sellers, Airbnb hosts – need more complex skills than what was required of them a decade ago. If you sell furniture on Etsy that you built with a Makerbot 3D printer that you keep in your living room, your skills probably have grown more advanced.
But, for the most part, the sharing economy is not creating new machines that people must learn to use to produce more stuff. It’s creating new marketplaces to access familiar things in better ways.
"There’s something a little different going on with the sharing economy," Sundararajan says. And he doesn’t yet know the broader implication of this.