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Gig Economy

USA

SoFi lists gig economy ETF

Full time work, and the benefits it comes with, is a thing of the past a new ETF believes. San Fransisco fintech SoFi is listing a new actively managed ETF tracking the “gig economy”, which will be advised by Toroso Investments.

The SoFi Gig Economy ETF (GIGE) will invest in a concentrated portfolio of 50 companies that Toroso believes will benefit from workforces “where employees or contractors are empowered to create their own freelance business by leveraging recent developments in technology,” the prospectus says. 

Going through the investment strategy, GIGE is mostly interested in app makers. One imagines that the newly-listed Lyft will be in the index, so too will the soon-to-be-listed Uber.

Analysis – good for investors less good for workers

Rather than editorialise on the gig economy, we’ve done a cut and paste job from other media outlets to give you a broad based picture of what the gig economy looks like and who might benefit from it.   

 

The New York Times: “The Labor Department weighed in Monday on a question whose answer could be worth billions of dollars to gig-economy companies, deciding that one company’s workers were contractors, not employees.

"As a result, the unidentified company — whose workers, it appears, clean residences — will not have to offer the federal minimum wage or overtime, or pay a share of Social Security taxes. And while the decision officially applies only to that company, legal experts said it was likely to affect a much larger portion of the industry.

 

"The move signals the Trump administration’s approach to the way gig companies, a growing share of the economy, must treat their work force. As companies like Uber and Lyft begin to sell shares to the public, industry officials estimate that requiring them to classify their workers as employees would raise their labor costs by 20 to 30 percent.”

 

The Baffler: “the gig economy is a Ponzi scheme that leverages the insecurities of millions of un(der)employed workers while shifting huge amounts of capital, data, and corporate power to a distant class of VCs and executives… Ethical consumerism is a mug’s game, one that can become mired in the kind of preening virtue-signaling represented by the #DeleteUber campaign. Every day we are complicit in exploitative economic transactions. Silicon Valley’s achievement has been to re-cast these transactions as liberating acts of self-expression.”

 

American Enterprise Institute: “One of the most interesting aspects of the tech-fueled growth in high-skilled gig economy work is that it puts a premium on education. Workers are incentivized to acquire skills demanded by the marketplace… once in possession of these skills, workers—able to market themselves and reach broad client bases thanks to technology—are less reliant on employers.”

 


 

 

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Bernie Thurston

Bernie Thurston is the founder and CEO of Ultumus, a leading provider of ETF and index data, calculation, and workflow solutions. With over 20 years of experience in financial technology, Bernie has been at the forefront of index and ETF innovation since 2003.

His finance career began at Markit, where as Managing Director for Equities he designed and developed products for index and ETF composition and dividend forecasting from 2003 to 2011. He then founded and led DeltaOne Solutions as Managing Director, building it into a global provider of index and ETF trading data and technology services. The company managed over 100,000 multi-asset class products before being acquired by Markit in 2015.

Following the acquisition, while working for an ETF issuer, Bernie identified fundamental issues in how index and ETF data was represented across the industry. This led him to found Ultumus in 2016, building solutions for ETF primary market operations. Under his leadership, Ultumus has grown into a market leader serving major financial institutions globally, with its ETF Order Management System (OMS) supporting create and redeem workflows worldwide and its PCF platform calculating and distributing portfolio composition files for ETF issuers across every major market.

Bernie sold Ultumus to SIX Group in 2021, where it continues to expand across Europe, North America, and Asia-Pacific. Known for building lasting teams and leveraging cutting-edge technology, Bernie is focused on establishing Ultumus as the backbone of the global index and ETF industry through standardisation and automation.

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