There’s been plenty of speculation over the past few days, about how a Trump administration will impact the gig economy and contract workers, both in the US, but also here in Australia. We’ve tested the pulse of the brainiacs at CXC Global across APAC, in addition to reviewing various news & trusted media sources. Our summary of the views & what are genuine speculations, we’ve provided for you here.
Fingers crossed, the global economic situation won’t derail. Progress won’t come unstuck. And innovation in how workers are engaged will continue to evolve.
Of course, this all remains to be seen.
A Couple of Trump Policies:
- The Economy: Politico, a widely read, trusted news source of global political news, has stated that a Trump administration could easily ignite a global recession. One with ‘no end in sight’. This is on the back of his proposed trade tariffs on China, his tactic to lure business – and jobs – back to the US with a massive proposed drop to company tax rate (he’s claiming to 15%). He’s calling China a ‘currency manipulator’, and proposes to ‘pursue action’ on this basis
A global recession? Scary stuff. But more jobs & companies located in the US? A total bonus for the local economy and contingent workers.
In terms of economic impacts, he will likely try and be more protectionist and antagonise China: the biggest impact potentially being a drop in confidence, especially in Australia (where we already have uncertainty over China anyway). A protectionist USA is not good for the Australian economy, while people in Australia rail against the TPP – as a small country we are in a position where there is more upside in the long term. A trade war would obviously be negative, but what is the likelihood of such an outcome? China have a lot to lose as well.
- And further to point 1, Trump is proposing to end the offshoring act: where US companies relocate offshore and ship cheaper products produced overseas, back to the US (which could potentially reduce competition for US based gig workers). Again, a controversial policy, but one that may benefit contingent workers in the US only. The repercussions, especially for countries from which these products are currently being produced, will be somewhat different.
- As we stated above, he’s calling for business tax rates to be cut to 15%
Having said all of the above, it’s become apparent that Trump has quietly removed much of his campaign rhetoric from his website regarding immigration & his proposed ban on Muslims. So speculation is really the call of the day with respect to him following through on these proposed policies.*
*When we first wrote this article, this was absolutely the case: a quiet removal of content from Trump’s website, about banning Muslims. Now, this content removal is being noted as a ‘glitch’ by the President-Elect’s team.
So….this is truly a unique situation. In the past, the constituency could be confident of what to expect because a politician would have had to explain their plan and you could factor in the likely impacts: economically, socially, fiscally. However increasingly politicians have been able to get into office without explaining any of their policies (even ‘jobs and growth’ was ridiculously vague here in Australia in July of this year, so it is not just a Trump phenomenon).
There’s a very real chance Trump will not deliver on many of his campaign promises. But instead, he’s likely to make small changes and then sell his rhetoric as a ‘I did this deal’ type scenario. Also a very real chance, that much of these changes will have no material impact but if it makes people ‘feel’ better, that will be the ultimate measure of his success (in his eyes, in that of his supporters).
There’s a real chance the election of Trump will increase use of contingent/gig workers in the US. Which, at current levels of up to 50% in some sectors, has the potential to be what is increasingly, the ‘new normal’ for workers & the organisations engaging them. His campaign claim “I will be the greatest jobs producing president that God ever created!” will absolutely be more achievable for contingent/gig workers, particularly if the corporate tax is slashed. In addition, Trump is also likely to drive usage of contingent workers through his infrastructure spending (blue and white collar).
Any impact on trade with China would significantly increase global economic uncertainty (the US is the largest buyer of Chinese output and the knock-on effect would be significant for Australia as China buys one-third of our exports). This economic uncertainty may also fuel the use of contingent/gig workforce as companies are looking to contain fixed costs and increase workforce flexibility.
Keep in mind also, China is Australia’s biggest trade partner. America is our third biggest. A sense of unpredictability will ensure endemic uncertainty in markets worldwide as well as a potential stifling of investments in long-term projects.
If the republicans stick to their free market ideology then there will not be any new impediments on contingent workforces in a regulatory sense, but that will not extend to Australia. The question is, how does that play into Trump’s American jobs mantra? This is the difficulty in projecting outcomes – there are conflicting forces at work.
The Republicans just elected a non-religious, social progressive as their President. The fact it is Donald Trump is only slightly more remarkable.