Conference Presentation, Panel
Is the Sharing Economy the New Normal?
Milken InstituteJosh Barro, Stacy Brown-Philpot, Kenny Dichter, Belinda Johnson, Alan Krueger, Artie Minson
- The sharing economy is projected to expand rapidly in transportation and labor markets, potentially shifting from under 1% to 5-10% of the economy, though it is expected to be a significant feature rather than engaging the majority of the workforce within the next decade.
- Supply-side dynamics indicate workers will increasingly prioritize flexibility to supplement income, leading to a labor model defined by short-term 1-2 year cycles rather than long-term tenure, with specific platforms like Wheels Up targeting 10,000 to 12,000 corporate members within five years.
- Efficiency gains and cost advantages, such as Uber reducing empty miles to 0.5, are expected to allow pricing 30-40% below traditional taxis while maintaining driver pay, provided the model remains scalable without regulatory interference.
- In private aviation, Wheels Up aims to double production levels to 1,000+ deliveries over 10-15 years through semi-private jet sharing, though strict FAA and DOT oversight is anticipated to limit unauthorized commercial sharing and regulatory arbitrage.
- TaskRabbit anticipates 15,000 monthly users seeking work, fostering a shift toward ongoing client relationships and a "new normal" where trust barriers lower as vetting and quality improve, while Airbnb expects 75% of major city listings to reside outside hotel districts and rural tourism to expand via local partnerships.
- WeWork projects viral growth in its community model with major enterprise adoption, aiming to become the world's largest global business and living community within 10 years by integrating residential "WeLive" locations to meet member housing needs.
- Macroeconomic impacts are contingent on the gig economy's rise from ~1% to 5-10%, with a "less happy scenario" involving downward pressure on traditional sectors offsetting macro efficiency gains in a "happy scenario."
- Future labor regulations are predicted to necessitate a "grand bargain" establishing an "independent worker" category with portable benefits, resulting in a shrinking core of traditional employees and an expanding periphery of on-demand workers.