The new year rang with a lot of new, progressive policies hitting the country. Minimum wage went up in roughly a dozen states (and many more cities). New laws went into effect to protect illegal immigrants, prevent forest services from preventing fires and to locally tax carbon usage.
There’s a whole bunch of stupid flying around, but one bill in particular has already made a huge impact. California passed a law to protect freelance workers. Naturally, it killed an entire industry.
This particular terrible California law is called Assembly Bill 5 (AB5). It was passed last year, and it redefines what it means to be a direct employer or employee. The idea of the bill was to force employers to pay benefits to independent contractors.
On the surface, that might sound nice. It could increase healthcare coverage and vacation time. But, as is always the case with socialist law, the application is not so nice after all.
To be specific, AB5 sets out a long list of limitations on when a worker can operate under an independent contractor agreement. As an example, freelance writers can only submit 35 times to a single employer. If they exceed that limit, they must be hired as a regular employee.
That means that a large number of regulations come into effect. It makes the cost of employment rise precipitously, and generally, the end result is that the independent contractors make less money or get cut. The latter is more common, and AB5 axed many thousands of jobs at the start of the year.
Leftists praised this law when it was signed. Shortly after, they realized that they were all gig employees. Rather than getting benefits for nothing, the law was eliminating their sources of income.
As an example, Vox Media published dozens of stories promoting AB5. Once it became law, they fired 200 freelance writers because they couldn’t afford to keep up with California labor laws for all 200 workers. Roughly 30 full-time employees now do the work of 200. It’s bad for everyone.
On the broader scale, there were hundreds of thousands of gig jobs in California. From freelance writing to independently contracted handymen, Uber drivers and so much more, all of those jobs vanished overnight. Over a hundred thousand jobs have already left the state, and workers are following suit.
It’s so extreme that California is now set to lose a Congressional seat because their net population change is negative. People have to migrate out of California faster than babies are being born.
To be fair, plenty of that migration has to do with unavailable housing and the overwhelmingly expensive prospect of surviving in California’s socialist economy. But, the loss of gig jobs was fuel on the fire. Tens of thousands of workers have had to move simply to maintain employment.
Ultimately, this is another classic example of socialist regulations and policies killing jobs. Plenty of the people who supported AB5 did so out of a feeling of charity. They wanted to make sure everyone had access to great benefits.
Instead, they made the cost of labor too much for the market, and they killed thousands of jobs. When you do what feels good instead of what makes logical sense, this will always be the result.
Maybe, if California burns itself to the ground thoroughly enough, a working society can be built in the ashes. Then again, leftists never learn, so that seems unlikely.