Some policymakers and unions have challenged the “gig economy” model of engaging independent workers and call for a reclassification of independent platform workers as employees. This policy shift would imply a move from a flexible work model, where couriers decide when and where to work, towards an inflexible work model, where the platforms or other employers of delivery staff predetermine hours.
Based on a pan-European survey of more than 16,000 couriers, latest public information, as well as new data sought from food delivery platforms, a study by Copenhagen Economics analyzed:
- Why do people choose to work under an independent work model as a courier and what are their preferences regarding flexibility?
- What are the main characteristics of the delivery platforms’ business models, and what role does the flexible supply of couriers play in serving demand?
- What economic value is at risk if the flexible work model had to be abandoned?
This economic study did not research access to social protection and other aspects (e.g., legal) of labor conditions and models – even though they remain important issues to assess and discuss – but focuses on the value creation associated with flexibility. External and societal costs were not in scope.
Key findings
Food delivery is a significant sector enabling many opportunities for couriers to complement their existing activities by choosing courier work in a flexible model, which couriers value.
- Based on data, the researchers estimate that yearly revenues of the food delivery ecosystem were EUR 20bn in Europe (2020). In this growing sector, food delivery platforms partnered with at least 375.000 active couriers on average per week (a higher number over a year).
- Delivery work is a complementary work for 72 per cent of couriers and makes up over half of couriers’ total income.
- Couriers actively seek and value flexible work. Flexibility is the main reason for working as a courier for two thirds of respondents. Over half would seek flexible work elsewhere or start a business if delivery work was not a possibility.
- Most couriers prefer a flexible work model over fixed employment. Almost 70 per cent of surveyed couriers would not give up flexibility for fixed schedules even if this hypothetically meant (at least 15 per cent) more income.
According to the study, abandoning the flexible work model would harm couriers’ jobs and earnings:
- The surveyed couriers estimate that their earnings would on average decrease by around 20 per cent if they could not work as couriers (but seek other types of work instead or do nothing else instead).
- If forced to work at hours pre-determined by the platforms/employer instead of flexible hours, up to 250,000 of the current couriers would lose the opportunity to work in food delivery. Under those circumstances, only some, but not all, of these workers will seek work elsewhere.
- Based on survey evidence, Copenhagen Economics estimates that up to 75.000 couriers in Europe could be entirely discouraged from the workforce if policy initiatives were to curtail flexible work both in the delivery sector and elsewhere. In short, for many of these couriers more traditional (inflexible) part- or full-time work is not an option.
- Correspondingly, up to EUR 800m in earnings for these workers are at stake if new policies were to curtail flexible work.
- According to the study, abandoning the flexible work model would lead to inefficiencies and harm the entire food delivery eco-system.
The study was paid for by Delivery Platforms Europe (on behalf of Bolt, Deliveroo, Delivery Hero, Uber, and Wolt).