TaskRabbit and the rise of microlabor

One of the classic benefits of technology is flexibility. It lowers the transaction costs on various exchanges, meaning things that were once “not worth it” cross into the “worth it” category. In a world where things must be printed on paper, it’s not economically viable to share your random thoughts with a few hundred people. In the age of blogging, why not?

We are now starting to see the same thing in the labor market. About three-and-a-half years ago, I kept trying (unsuccessfully) to sell an article called “Cutting Coupons? Not in the Craigslist Economy.” The gist was that most personal finance advice was premised on the idea that people can’t change their incomes. Your job is your job, and unless you’re going to get a second official job, or another household member will enter the labor force with an official job, your income is what it is. At one point that was true, because the casual labor market was quite underdeveloped. But then sites like Craigslist came along, which introduced the gig economy. People can do one-off tasks whenever they have time to kill (or need more cash) and people with extra work can offload it without creating an official job or going through the “not worth it” work of, say, posting flyers on telephone poles and Laundromat bulletin boards. (The fact that most of this operates outside the reaches of the IRS also lowers transaction costs, but casual labor like babysitting and snow shoveling almost always has, so I don’t really address that idea much).

The net result of this is that people can outsource many more tasks than before — freeing up time to focus on core competencies — and that creates opportunities for income generation for other folks. While Craigslist was an early player in the microlabor market, now we’re seeing specific sites for gigs. TaskRabbit, for instance, is the subject of a Wall Street Journal feature today. The paper reports on some folks earning $10,000 per year doing various tasks during time they might otherwise just be posting on Facebook. Of course, $10k isn’t going to massively change someone’s standard of living. But it’s more than most people will save with coupons.

Most of the gigs are the usual ones — administrative work, running errands, organizing events. But others are more intriguing (like showing up with a fishing pole and a magnet to help someone get his keys out of storm drain). And TaskRabbit puts in the value-added service of running background checks on its rabbits, so people are a bit more open to the idea of having some random individual show up in your office.

I predict that, with a lot of underemployment and an increasingly tech-savvy population, microlabor will be a real growth industry in the future,

What kinds of tasks would you like to offload? Which kinds of skills would you ever think of offering as a way to generate extra cash?

6 thoughts on “TaskRabbit and the rise of microlabor

  1. It is only for New York City and LA right?

    I’ve always thought it’d be cool to get paid for my second shift.. Like to take someone else’s kid or kids with mien to the aquarium and make say $5 an hour for it since I’m going anyway… every heard of that?

    Seems like weekend nannies are not that popular especially once you have kids of your own
    seems like cleaning is easier to outsource than childcare … though I have set up a babysitting share with a friend of mine..

    1. @Cara- I think they were expanding to other locations. Though yes, something like this needs a certain urban density.

      1. We have TaskRabbit in Boston, but I haven’t used it yet. I do have a virtual assistant who handles some of the administrative tasks associated with my writing (and she’s on the books, I’ll be issuing a 1099 through my accountant reporting the money I pay her to the IRS), BUT I still haven’t outsourced some of the more arduous tasks like following up on late invoices or filling out client paperwork. I’d love to get these tasks off my plate but I don’t know if it would make sense for her to handle those since they’re so complicated and it would open up potential privacy issues. Plus, for the amount I pay her (above minimum wage but less than I bill her hour), I don’t think it’s fair to assign really unpleasant tasks like collections that I don’t want to do myself.

        I think therein lies the rub. If you’re the person doing the tasks on TaskRabbit or other sites like GigWalk, is it really worth the time and the gas to drive across town for $10 or $20? (I don’t know what TaskRabbit pays but that would be generous on GigWalk). And if you’re the person outsourcing, it’s hard to justify paying lots of money for tasks like that which you could do yourself. Yes, I know the argument about time is money, and I’ve used it myself. But finding that balance where people are appropriately paid for their time and the people paying them can afford to do so (unless they’re in the 1% or even the 5% and may have hired help already) is really tenuous.

        1. These are good points. I report and pay taxes on my income and given social security and my husband’s income, my marginal tax rate is between 50 and 60 percent. Couponing still makes sense for me. (especially the GOOD couponing, like getting $10 or $20 at the grocery store for buying gift cards to places like Amazon and Home Depot)

  2. An extension of Laura’s argument on entrepreneurship (and pro it and for women especially) is twin mom’s comment on her marginal tax rate… we have to stand up for ourselves adn working women and recognize that our government still penalizes us for working ..by taxing married couples and two-income families .. meaning that the net income after childcare for many women is still way too low… I was thinking of this the other day especially for women whose husband’s salaries already bump them well into a 40 % tax rate etc… seems grossly unfair and doesn’t reward work and self-actualization which seems like what we were fighting fo rin women’s movement.. so not just students but also women and parents should get some breaks from gov when it comes to work and creating jobs.. even if they are these little jobs mentioned in laura’s article

  3. Great post. There are several good companies with different business models – which tap the power of people and internet to get work done. Here is a comparison list.

    1) WeGoLook : WeGoLook.com has over 7,000 nationwide “Lookers” (background check verified) who will go anywhere in USA for an onsite inspection. WeGoLook provides visual confirmation and a personalized report, completed by a real person, to verify a product, person, place or thing.

    2) Zaarly: Zaarly is a proximity based, real-time buyer powered market. Buyers make an offer for an immediate need and sellers cash in on an infinite marketplace for items and services they never knew were for sale.

    3) Agent Anything: People can post any service (task, errand, research, etc.) they need accomplished as well as the price they are willing to pay, and college students can perform these services to get paid.

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