President-elect Donald Trump’s decide for U.S. Secretary of Transportation is probably going a boon for journey-hailing corporations like Uber and Lyft.
On Tuesday, Trump introduced that he’s chosen Elaine Chao to steer the Department of Transportation throughout his presidency. Chao, who’s married to U.S. Senator and Majority chief Mitch McConnell (R-KY), was beforehand the Secretary of Labor underneath George W. Bush, and Deputy Secretary of Transportation underneath President George H. W. Bush.
While not a lot is understood about her stance on self-driving automobiles—an essential space for just about each transportation or auto firm at this time—she appears fairly pleasant to the so-referred to as “sharing economy.” Chao expressed help for the concept an growing quantity of Americans will participate within the “gig economy” and work half-time for multiple employer when she spoke at an American Action Forum event a year ago. (Hat tip to former Fortune editor Dan Primack for spotting this.)
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What’s extra, Chao repeated the identical declare that journey-hailing and residence-sharing corporations flip to pushing for much less laws: That these providers are merely a further supply of revenue for drivers and householders. At the occasion, Chao stated:
Take the experience sharing firm Uber, which revealed an evaluation of a consultant pattern of its workforce of greater than 160,000 drivers in 2015. Nearly half of the Uber drivers surveyed had a university diploma or greater. 62% had one other full-time or half-time job. Nearly half had medical insurance protection by means of one other job, partner or member of the family. More than two-thirds reported having monetary dependents at house. So it’s no shock drivers cited the pliability to set their very own schedule as one of the precept causes for partnering with Uber. Another regularly cited purpose was the necessity to complement fluctuating revenue from different sources.
Both Uber and Lyft have been sued for their classification of drivers as unbiased contractors as an alternative of staff, which frees them from offering drivers with advantages like medical insurance and reimbursing them for work bills. And each repeatedly argue that the majority of their drivers are half-time, and that making them staff would strip them of their flexibility.
Chao painted an analogous image about residence-sharing firm Airbnb, in addition to marketplaces like Etsy and eBay, and argued for the necessity for a brand new strategy to employment.
“We need to preserve the protections of the past for those who need them, while crafting new solutions that better fit the preferences of workers in the sharing economy,” she stated. “At a minimum, government policies must not stifle the innovation that has made this sector such an explosive driver of job growth and opportunity.”
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During her tenure as Secretary of Labor, Chao moved to slimmed down sure laws, whereas additionally pushing for unions to offer extra monetary transparency to their members.
Still, it stays to be seen how her division’s insurance policies will play out relating to self-driving automobiles, which, in response to journey-hailing corporations usually are not solely inevitable, but in addition coming quicker than we anticipate. Lyft co-founder and president John Zimmer, for instance, recently boldly predicted that by 2025, all Lyft rides in main cities can be carried out with self-driving automobiles.
So far, Uber and Lyft appear optimistic.”Ms. Chao’s information of transportation points is in depth and we sit up for working intently together with her,” Uber head of federal affairs Niki Christoff stated in a press release despatched to Fortune.
“We have the utmost respect for Elaine Chao, an accomplished public servant and highly capable leader,” a Lyft spokesman additionally informed Fortune in a press release. “We congratulate her on the nomination and look forward to working with her on an array of transportation issues.”