Damon who works full time at an upscale hotel and part time at a burger joint in Washington, DC, receiving his weekly schedule via text from his manager, usually with a request at the last minute to cover a missing colleague. To make sure he could receive these messages, Damon paired two essentially broken low-end smartphones, one with a broken screen and another that turned on and off unpredictably before he tries to use it. “I am waiting for my next check in so I can get another phone,” he told me. Meanwhile, he’s using his stagnant salary to buy a functionally required phone at work, all just to keep his current job.
Science fiction author William Gibson famously said that the future is already here, it’s just not evenly distributed. Smartphones and internet access on the go have made many of our working lives more productive and flexible. But the requirement for constant connectivity isn’t just a reality of white-collar work – it has spread to workers up and down the income ladder. And while the requirement has spread, the resources workers need to maintain it have not been evenly distributed. Today, more than a quarter of low-income Americans depend solely on their phones for internet access. Against the backdrop of historical income inequality, phones and data plans are increasingly becoming a costly burden on the least well-off.
Through interviews with precarious workers across the country, I have found that being connected to the internet is increasingly required to manage a wide variety of jobs in various parts of the labor market. low wages, far outpacing “contract economy” apps like Uber and Postmates. When we ignore these types of potential connections, we don’t see their mounting costs and consequences for those who are disadvantaged. Their requirement to stay connected constitutes a new tax on low-wage workers. And well-meaning interventions focused on closing the digital divide have failed to address the strong interest in keeping it open.
High cost connections represent a growing share of household income for low-wage workers. While maintaining these connections has become essential for many low-wage workers, their incomes are still not keeping up. According to 2020 figures from the U.S. Bureau of Labor Statistics, people in the bottom 20 percent of income earners spend an extra $150 per year on their jail cell. the phones compared to 2016. Connection costs represent more than half of what these households spend on electricity and nearly 80 percent of what they pay for gas. As a percentage of household income, people with the lowest incomes spent four times more on phones than those with high incomes. With low inflation, these problems could get worse before they get better.
While these spending disparities are predictable, they are not inevitable. As connectivity becomes increasingly imperative for low-wage workers, phone companies that cater to this segment of the market have profited by entering the market. As Louise Seamster and Raphael Charron-Chénier These forms of inclusion provide access to goods previously excluded by disadvantaged groups, but with conditions that ultimately reduce the benefits of access. Consumers who previously couldn’t pay the high upfront costs of buying a smartphone, or whose unpredictable income meant annual contracts were out of reach, can now have access to smartphones and data plans with lower credit, but under exploitative conditions that make connections more expensive. Black consumers are particularly targeted for these forms of inclusion, as systemic discrimination in employment, housing and financial services has created a credit score gap that makes prepaying and renting the phone is almost the only option.
In 2019, New York City sues T-Mobile because of a series of violations of consumer rights, including enrolling people in third-party funding through companies like SmartPay, which break down payments over time through rental agreements, but end up adding hundreds of dollars to the advertised price without a full explanation of the terms — ultimately ruining people’s credit. Phone rental programs and their dubious terms of service have also led to other legal actions (e.g. Sprint is facing a lawsuit Action-matching class on similar matters). These actions come amid a consolidation in the mobile phone market, as Sprint and T-Mobile, two companies that previously competed for low-income consumers, have merged, raised concerns on future increases in costs.
