The economic slowdown that the coronavirus pandemic has unleashed is likely to hurt millions of workers around the country as schools and restaurants close and businesses go dark. Many of the first to suffer have been workers in unconventional arrangements: independent contractors, part-time workers and others whose income varies from one week to the next.
Those workers tend to be clustered in the service industries that will be particularly hard hit, like food, transportation, travel and leisure. For many of them, their work status means it will be difficult to qualify for employer or government benefits intended to help weather the slump.
Some employers are ramping up their paid leave policies under public pressure, and the House of Representatives has put together an emergency plan to extend paid sick days and family leave to a larger share of the workforce. But many employers only offer paid time off to full-time employees, and more than 10 million working Americans are classified as self-employed.
Mardella Sue Rowland is one of them. The 67-year-old widow runs an exercise class at an assisted living home in Washington state, an epicenter of the outbreak. The facility is now on lockdown and Rowland’s class has been canceled indefinitely. She is technically an independent contractor and calls herself a “1099er,” a reference to the tax form used to report contractor wages to the IRS.
Rowland survives on Social Security payments and the $250 to $300 she earns from teaching exercise classes each week. She now finds herself at the mercy of the company that holds her contract.
“Knowing how these places function, unless a state or federal program comes through to pay people like me, then we’re screwed,” Rowland said. “A lot of us 1099ers just don’t qualify for a lot of whatever [safety net measures] they’re trying to push through in their slow, bureaucratic way.”
“This is getting to be just bone-crushing and disheartening,” she said. “And it’s not just me.”
Lots of people use the term “gig workers” as shorthand for Uber drivers and others who pick up work via online platforms, but there is a much larger universe of contractors like Rowland who don’t enjoy the benefits of a traditional employer-employee relationship. A major 2017 study from Harvard and Princeton economists found that workers in “alternative work arrangements” ― including independent contractors, freelancers and on-call workers ― rose from 10.7% of the workforce to 15.8% between 2005 and 2015.
In most cases, these workers won’t qualify for unemployment benefits because there is no employer paying into the insurance system on their behalf. They don’t have sick leave or paid vacation, and workers’ compensation would not cover them if they got sick due to their work during the pandemic.
“I feel like this coronavirus has really shown the heightened risk for gig workers and the gaps in our social safety net,” said Laura Padin, a staff attorney at the National Employment Law Project, a worker advocacy group. “Gig workers really are excluded from nearly all workplace protections and the benefits of [traditional] employees.”
The coronavirus lockdown has been especially hard on the original gig workers: musicians. Concerts and shows around the country have been called off to limit transmission of the virus, leaving artists, stagehands and other workers in the industry with empty calendars. Some will be able to replace their wages through benefit programs, but many will not.
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Mark Holley, a Houston-based trombone player, said all of the work between him and his wife, a percussionist, disappeared in a matter of days as the outbreak worsened. They are eligible for unemployment through the opera house and ballet they work for, but much of their income comes through private music lessons that are now being canceled.
“We will get through this and figure it out, but we potentially lost nearly all of our income in the last three days,” Holley said.
Many teachers and other educators will have much of their income covered as schools shutter, either because their districts will continue to pay them or because they’re eligible for unemployment benefits. But the closings could seriously squeeze school workers who are employed via outside contractors.
Natalie Galiotto works for a private after-school program that services a public school district in Georgia. She said she does not receive benefits because her position is part-time. She also earns money teaching through a home-schooling cooperative, but those classes have been canceled for at least a month. She plans to apply for unemployment benefits but isn’t sure what she might qualify to receive.
She would normally get by with the money she receives from renting out her house on Airbnb, but her bookings have already canceled through May. Frantically applying to jobs in recent days has not been fruitful: One potential employer, the Children’s Museum of Atlanta, has been forced to close its doors. Galiotto has already postponed a dental surgery she needs. But as a single mother with a 10-year-old son and bills coming due, she feels she has very few places to turn.
“I’m going to take out a loan from a neighbor. I’m going to have to,” Galiotto said. “What are my options?”
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