San Francisco Chronicle - (Sunday)
Jobs that will survive
Thumbtack CEO says listings on the site are for services that are not done by machines
Robots won’t eat all the jobs, says Marco Zappacosta, the CEO and co-founder of Thumbtack, a marketplace for service professionals from plumbers to yoga teachers to personal trainers. While automation is expected to replace many positions, he thinks huge growth will come in the types of local trades that Thumbtack showcases — work that cannot be sent offshore or done by machines.
To support those workers, he hopes the country will embrace portable benefits, streamline regulations, invest in training and skills, and build more housing.
Thumbtack has more than 200,000 people offering more than a thousand types of services. The lion’s share do home-related work: maintenance, construction and systems. Events, health and wellness, business systems and education are also popular.
People peddling their services on Thumbtack say it helps them cast a wide net to reach potential clients, eliminating one of the biggest hassles of being an independent professional.
Darrell Ross, an Oakland high school principal, does double duty as a wedding officiant, for instance, finding jobs on Thumbtack. His five-star ratings have led to about two wedding gigs a month. The site is an efficient way to reach people, he said.
“I believe in love, want to promote love, and this is a great way to bring people together to share a lifetime of joy, happiness and love,” said Ross, an ordained Christian minister since college.
This interview with Zappacosta has been edited for length and clarity.
Q: How did Thumbtack start?
A: My co-founders ( Jonathan Swanson and Sander Daniels) and I went hunting for the biggest problem that technology could solve. It was a banal observation: Why is it so damn hard to hire a plumber? It’s not
that there aren’t hardworking professionals; it’s a matchmaking problem. In 2008-09, all we saw were online versions of offline products: directories and classified links. You were still on the hook for calling, saying, “Can you do this?” The missing link was a true marketplace experience, helping customers connect with the right pro.
Q: There’s a lot of talk about (aritificial intelligence) and automation killing jobs. Why do you say the future of work isn’t as bleak as predicted?
A: The doom-and-gloom narrative is easy to tell and fun to scare people with. Thumbtack has a perch to see what will be left: The nonroutine, nontradable jobs are the future of work. They’re growing, providing great wages and can be the source of purpose for people for a long time to come.
Q: What are some examples?
A: When a human being is providing service to the real world. All of health care and education. Florist, personal trainer, social worker, mechanic, interior decorator, electrician, engineer. Local services are expected to be 91 percent of all jobs created in the next decade, according to the Bureau of Labor Statistics.
Q: Will all these future jobs be small businesses?
A: Industries growing over the next decade will overwhelmingly be comprised of small firms or self-employed workers, basically local services. It’s easy to understand: Most plumbers, housekeepers, personal trainers don’t work for big conglomerates. There aren’t economies of scale like in manufacturing.
Q: What do workers lose by not being employees?
A: Being part of a big firm provides benefits and income smoothing. Thumbtack provides income smoothing by providing a constant stream of customers. Etsy, Shopify, other platforms empower local professionals and small businesses to do more, and through that to employ more. That’s gotten lost in the conversation about automation replacing all the work.
Q: Isn’t a lot of gig work essentially low-wage McJobs?
A: Average Thumbtack workers make more than $70 an hour; that’s middle-class employment right there. About twothirds of Thumbtack professionals do the work as their primary form of employment.
Uber (and) Lyft are the inverse; about 80 percent of drivers do it very part time. What Uber (and) Lyft have done for labor is of immense value. Almost every adult being able to tap into a secondary source of income is very powerful. They’re great sources of secondary short-term income. But elevating that as the future of work is a mistake. They are doing everything they can to automate away the main cost structure of their business: the drivers.
Q: What’s the impact of the recent California Supreme Court ruling making it harder to classify gig workers as independent contractors rather than employees?
A: “Gig economy” has become a muddied term. Gig work has a long history: journalists, Hollywood workers, consultants — many, many industries already operate this way. Gig work itself is not a sign of low wages or unstable income. It’s just industries where you serve a number of varied clients over time, not one salary. We think gig work can be highly remunerative.
Q: How are you changing the gig economy? A: The sharing economy to date has been about sharing capital assets: cars, home, apartments. But the biggest underutilized asset is human talent. We give that talent a market, a place to showcase itself, find customers, ultimately turning time into money. In doing that, we empower a huge range of workers.
People have talent, but often don’t have ... skill sets to find a market for that; to market themselves, create a web page, drive clients, do small business administration. We’re making it more viable to be self-employed.
Q: What policies would best help support the gig economy?
A: One of the best would be benefits portability. The Affordable Care Act already provides that for health insurance. Lots of other benefits need to decouple from formal employment. By articulating that the future of work will be small businesses, (we can) support these workers with rights, privileges and benefits.
Society should say disability insurance, tax-advantaged retirement accounts, access to health care should be provided to all workers, not just those who have jobs at companies. It’s philosophically key to decouple benefits from formal employment.
Q: What other policy changes are needed? A: Make regulation less burdensome for small businesses. It’s not that they should be more- or less-regulated; it’s about ease of compliance. As the size goes down, the cost of compliance goes up. A big company has a compliance department and an army of lawyers and accountants. For a twoperson roofing company in Omaha dealing with workers’ comp for the first time, it’s terrifying. It arguably deters people from hiring more.
Q: You’ve said that housing is linked to job growth, too.
A: Local is very important for service jobs. If you can’t live somewhere because it costs too much, you can’t work there. Housing policy needs to enable more home construction and lower home prices. It’s obvious: There aren’t enough homes, so we need to build more. We know how. Plenty of contractors would like to do it. Homeowners would pay for them. We just have to enable it.
Q: How do macro trends affect the gig economy? It arose during the economic downturn when jobs were scarce. Now unemployment is at historic lows.
A: The gig economy isn’t a monolith. As the macro economy continues to strengthen, that might mean fewer people going to ... platforms like Uber and TaskRabbit. But it’s good for Thumbtack, because as incomes rise, you see more consumption of local services.
Q: What are unusual or new jobs on Thumbtack?
A: Life coach, which isn’t even recognized by the (Bureau of Labor Statistics) as an occupation but has blown up over the past five to 10 years, with an estimated 18,000 life coaches in the U.S. Personal trainers 30 years ago weren’t recognized by the government; it was an obscure niche industry. Other surprising ones: skateboard instructor, balloon artist.
Very few categories are as big as this trillion dollars of spending on local services, almost completely offline with no digital revolution for how they are discovered and transacted. I’d bet that in the next five to 10 years you are more likely to find and hire professionals online.