The labour market struggled to absorb the influx. In Colombia, almost half of the working population does not have a legal contract, making finding formal jobs even tougher for new arrivals. According to Lerner, 10% of Venezuelan workers in Colombia have a contract. Yet a report by Rosario University and the Konrad Adenauer Foundation (KAS) found just 0.7% of Venezuelans migrants had found formal employment in Colombia, with another 45% in the informal sector.
“The work permit that most of them have is only valid for two years, and employers do not want to hire someone that might leave so soon,” says María Clara Robayo, one of the report’s authors. “Even when they get this document, they also have problems opening bank accounts and signing work contracts.”
Xenophobia also plays a role, adds Guataquí of Rosario University. Colombia is not used to receiving migrants, meaning many people still prefer to hire locals, he says.
One of the biggest impacts has been wage depression. A World Bank study that has not been published yet found that a 1% increase in migration from Venezuela caused an average 3% decline in wages in Colombian host communities. This number includes Colombians who moved to Venezuela to escape the civil conflict and then returned home amid the crisis. Narrowed to just Venezuelans, the wage drop would be closer to 5%.
“The economy has a certain number of jobs available and there are a certain number of workers available. When you increase the number of workers and not of jobs available, employers can hire workers for lower wages,” explains German Caruso, a World Bank economist.
At a protest in October 2018, Colombian contractors claimed Rappi had reduced all couriers’ wages per delivery as a direct result of the Venezuelans. The workers claimed that migrants didn’t know the previous rate and desperately needed money, so agreed to work for less.
Borrero confirms the payment system changed last year, but says it wasn’t related to the Venezuelans. He says Rappi made the system fairer by reflecting distances and types of service: couriers might get less for a short-distance delivery but a higher rate for a longer-distance delivery.
Borrero says Rappi is being “penalised” for the actions of other gig economy companies that have used the model to pay less than minimum wage. “People think that we are looking for a way to make more money, to pay less to our couriers. But we have a waiting list, we didn’t have to pay more than the minimum wage to people. We want to be a company that creates opportunity to people in Latin America, we want to help the continent to grow.”
According to Borrero, Rappi couriers get paid on average 2.5 times the minimum wage in Latin America. In Colombia, the minimum monthly wage currently amounts to about US$258 (£203). The company says payment depended on distance, type and day. In Colombia, a courier can get US$ 1 to 1.25 for a restaurant delivery, or up to US$ 4 for a more complicated task.
Carlos Esteban, a Venezuelan courier who arrived in Bogota seven months ago, says he earns about $300 a month working nine hours per day, six days a week – more than the minimum wage, but less than the estimate given by Borrero. New joiners usually have lower customer ratings, meaning the app directs fewer deliveries their way. Margen Albornoz, a Venezuelan courier, thinks higher worker numbers means people are receiving fewer requests. But she says she earns more working for Rappi than in other casual jobs she’s had in Colombia.
Her Colombian colleague Esteban Girardo is more outspoken. “There are so many Venezuelans at Rappi that it is not possible to get money working for it anymore,” he says. The 18-year-old, who has been waiting for an hour for a request, says that on good days he can earn $10 for six hours. On bad days, he receives $2.15, way less than minimum wage.
‘A positive thing’
Worldwide, migrants can benefit from the gig economy, but experts say platforms like Uber, Lyft and others can be a double-edged sword.
“In a sense, the whole gig economy is fantastic for immigrants, because it allows them to arrive in a country and begin working the next day, without spending much time searching for a job,” says Kirsten Sehnbruch of the International Inequalities Institute at the London School of Economics. On the other hand, there is concern about how vulnerable gig economy workers are, with long hours, no job security and weak ties to social welfare systems.