Digital Labor Between Germany and Romania

Large and small online platforms have become “essential,” especially in Western societies. These platforms are kept in operation—as are large parts of the digital, seemingly fully automated world—by crowdworkers, who are systematically rendered invisible. It is well known that the majority of these “ghost workers” are located in countries of the Global South, including India. Less attention is paid to the growing number of digital workers in Eastern Europe. Social scientist Mira Wallis takes stock of the situation. This material is published in partnership with the Berliner Gazette’s BLACK BOX EAST project.

In the spring of 2020, the Corona crisis brought the German economy’s dependence on migrant labor into focus, at least temporarily. Agricultural associations warned of “supply gaps” in the fruit and vegetable sector due to entry bans on seasonal workers. In the end, tens of thousands of harvest workers were flown in from Eastern Europe with special permits. In May, the wildcat strike of Romanian harvest workers on an asparagus and strawberry farm in Bornheim in western Germany caused a stir. The strike addressed, among other things, unpaid wages and disastrous housing conditions. Not only in agriculture, but also in the meat industry, healthcare, logistics, and many other sectors, migrant, often Eastern European, labor is central to the functioning of the German economy.

The following text is focused on another, relatively new group of mobile workers from Eastern Europe. They, too, meet the high demand for both skilled and cheap labor. However, they do not “physically” enter Germany in order to find work. Instead, their labor power migrates “virtually” to Germany via digital platforms—while the workers themselves remain in their home countriescountriesMoritz Altenried, Manuela Bojadžijev, Mira Wallis, “Platform (Im)mobilities: Migration and the Gig Economy in Times of COVID-19” in Routed (Epidemics, Labour and Mobility), Issue 10 (2020).. 

They are so-called crowdworkers, who log on to platforms such as Upwork, Microworkers or Appen every day and perform a wide range of web-based activities there. The tasks brokered by the platforms range from small-scale tasks that can be performed without much training, such as categorizing images or recording sample sentences (microtasks), which are required, for example, to produce training data for AI systems and are paid with a few cents each, to complex and time-consuming tasks such as translations, programming or web design (macrotasks), some of which are paid with hourly wages. 

Crowdwork platforms offer companies a solution to various forms of labor shortages and provide access to a globally distributed, cheap, flexibly scalable, and culturally heterogeneous workforce. With a digital device and a stable internet connection, crowdwork can potentially be done at any time and from any location. Nevertheless, it usually takes place in private housing, which is why this form of platform work can also be described as digital home-based laborlaborMira Wallis and Moritz Altenried, “Zurück in die Zukunft: Digitale Heimarbeit” in Ökologisches Wirtschaften 33:4 (2018), 24–26..

In the public debate about how digitalization is changing the world of work, crowdwork, also referred to as the “remote gig economy,” has been discussed more and more in recent years. As regards the global distribution of this form of digital labor, it is usually (rightly) emphasized that the majority of crowdworkers are located in countries of the Global South, including in India, Bangladesh, Pakistan and Venezuela. 

Less attention is paid, however, to the growing number of digital workers in Eastern Europe and the relationship between the European “center” and the “periphery” in the global digital economy. This is despite the fact that a World Bank study in 2015, for instance, ranked Romania and Serbia as the world’s leading online outsourcing countries when setting the number of crowdworkers in relation to the total population of the countriescountriesSiou Chew Kuek et al, The Global Opportunity in Online Outsourcing (Washington, D.C., World Bank: 2015).. The Public Policy Research Center has also observed an increase in crowdworkers in southeastern Europe since 2019, highlighting Northern Macedonia alongside Romania and Serbia. 

Between Germany, Romania and the U.S.: Crowdwork in Transylvania

One of these crowdworkers is Gabriela (name has been changed), whom I met in November 2019 during my fieldwork in Romania in Cluj-Napoca in Transylvania. Gabriela is 26 years old and studied veterinary medicine. In addition to Romanian and Hungarian, she also speaks German as a native language. In its eventful history, the region of Transylvania was part of the Austro-Hungarian dual monarchy for a long time, which is why a majority of Romania’s Hungarian and German minorities still live there today.

Gabriela spent her childhood in Germany because her father was granted political asylum there in 1988, one year before the end of the Ceaușescu regime, due to his German forefathers. When Gabriela was 13 years old, the family returned to Romania. In 2012, she began her studies in Cluj and immediately had to look for a job to support herself. In addition to a few jobs in call centers and transportation management, she tried out a number of online platforms offering translation services, transcriptions and voice-overs. She eventually stuck with Upwork, a U.S.-based freelance platform that is one of the world’s largest crowdwork platforms, providing all kinds of (mostly higher-skilled) digital work. 

During the last seven years, earning money on Upwork has for her sometimes been a supplemental, sometimes a full-time job, but always a central source of income. Her clients are mainly German companies, medium-sized businesses and IT start-ups, for whom she does all kinds of assistance work, from customer communication and translation to staff recruitment and event management. She earns about 8 euros per hour from this solo self-employment—far more than she could earn working as a veterinarian in Romania. The minimum wage in Romania in 2019 was 446 euros per month, and the average monthly net income was around 650 euros. In the interview, Gabriela describes this wage gap as a key reason that makes digital labor platforms attractive to both her and her clients. In addition, she particularly emphasizes her German language skills and cultural knowledge as qualifications:

“There are certainly a lot of Germans or German-speaking people on Upwork. They want German manners and Romanian payments, and it is very difficult to find someone who not only speaks German but also behaves like a German in customer service, for example. [...] [The customers] on Upwork always want the same thing. They actually want Germans, but they don’t want to pay whatever amount of money for a personal assistant, even if it’s only part-time. I don’t know how much the minimum wage is in Germany, but I don’t think anyone would be a part-time personal assistant for 200 euros a month in Germany.”

So both factors, the low hourly wage Gabriela receives for her services compared to crowdworkers living in Germany, as well as her knowledge of the German language and culture, play an important role here. The example illustrates that the remote gig economy enables two things: first, a new form of global arbitrage of labor, and second, access to a heterogeneous, culturally diverse workforce.

Digital platforms and the global arbitrage of labor

Looking initially at the first point: crowdwork platforms offer companies access to cheap labor that is available on a temporary and flexible basis. The digital platform creates a new form of global division of laborlaborMoritz Altenried, “Die Plattform als Fabrik. Crowdwork, Digitaler Taylorismus und die Verviel- fältigung der Arbeit” in PROKLA. Zeitschrift für kritische Sozialwissenschaft (47:2, 2017), 175–192. in which “traditional” forms of regulating decentralized home-based work (such as using the piecework principle) are combined with new mechanisms of digital, often algorithmically driven control. This makes it possible to position geographically dispersed workers across the globe in constant competition with each other across different time zones, further pushing down wages. 

Platform companies thus contribute to a further “arbitrage of labor”—exploiting different wage levels, reproduction costs, and time differences across geographic labor marketsmarketsMark Graham and Mohammad Amir Anwar, “The Global Gig Economy: Towards a Planetary Labour Market?” in First Monday (24:4, 2019); Shehzad Nadeem, The uses and abuses of time: globalization and time arbitrage in India’s outsourcing industries in Global Networks (9:1, 2009), 20–40. . While German crowdworkers on Upwork are outbid, for example, by the prices of Romanian workers in the domains of virtual assistance or software development, the latter, in turn, cannot compete with the even cheaper services of crowdworkers from India or the Philippines. This business model is based on locally uneven conditions of reproduction of the workers. 

Despite the precarious working conditions, the high fluctuation of tasks, the lack of protection against dismissal or the lack of social security, in many parts of the world crowdworkers are able to generate significantly more income in the global digital economy than on the local labor market. In addition, the expectation of a “standard employment relationship” with social security and the prospect of a “good” pension, though historically this has always benefited only a small group of workers in Western Europe, is even lower in Eastern European countries such as Romania.

“Romanian payments and German manners”

Crowdwork platforms, however, enable more than access to merely cheap labor power. It is not only the price of labor that makes outsourcing via platforms attractive for customers, but also the “heterogeneity” of the global workforceglobal workforceMoritz Altenried,The Digital Factory (Chicago: 2021, forthcoming).. Demand for crowdwork is particularly high in the AI industry, as the creation and optimization of machine learning models requires a culturally diverse workforce that can feed algorithms with local languages and cultural practices. If Amazon, for example, wants to market its digital language assistant Alexa to Romanian consumers, the software will need to be trained with the country’s different languages, dialects, and accents. 

However, not only in the AI industry, but also in other industries, “cultural” factors play a role for clients when recruiting temporary workers. As the quote from Gabriela from Cluj illustrates, German companies are seeking German-speaking freelancers in the field of virtual assistance on the platform Upwork, for example, relying on “Romanian payments and German manners.” 

Other Romanian crowdworkers explained in their interviews that some clients limit their job postings to “European” workers and explicitly exclude certain nationalities from the Global South that are particularly active on the platforms (such as India or the Philippines). As a consequence of this racist discrimination, workers from these countries sometimes use the strategy of “renting” the accounts of Romanian or generally European crowdworkers on a commission basis to gain access to better-paid jobs.

Digital nearshoring to Eastern Europe

Eastern Europe thus plays a special role in the global economy of digital labor. Crowdworkers from this region are “cheaper” than many Western European workers, and at the same time are often privileged over workers from the Global South. The logic of outsourcing work via digital platforms is similar to more traditional forms of outsourcing, meaning the “physical” relocation of entire business units or processes; this has a long history in Eastern Europe. 

In this context, Eastern Europe as a location is promoted to potential Western European clients, especially in the IT industry, as a “nearshoring” option, with the advantage of similar time zones and the “cultural proximity” of the workers, as contrasted with offshoring locations in the Global South. At the same time, many Eastern European countries such as Romania are trying to establish themselves even more strongly as IT locations by improving their digital infrastructure and training skilled workers. The IT industry in Romania is now one of the country’s most important economic sectors, and the government is trying to motivate young people in particular to work in the tech industry, for example by offering tax relief for freelance IT specialists. 

This is not just a recent development either. Romania already trained a highly specialized workforce in computer science and cybernetics during its socialist erasocialist eraErin McElroy, “Digital nomads in siliconising Cluj: Material and allegorical double dispossession” in Urban Studies (2019), 1-17..

Crowdwork as a new form of labor migration?

Hence, in order to understand the rise of digital workers in certain regions and countries such as Romania, we need to not only consider the arbitrage of labor, but also to take a look at the regional and local particularities of the heterogeneous workforce. This involves, on the one hand, the question of what makes these workers attractive to clients and, on the other, what specific motivations are driving crowdworkers onto the platforms and how these motivations are related to their respective local labor markets and conditions of reproductionreproductionMira Wallis, “Digitale Arbeit und soziale Reproduktion: Crowdwork in Deutsch- land und Rumänien” in Altenried, Moritz/Dück, Julia/Wallis, Mira (eds.): Plattformkapitalismus und die Krise der sozialen Reproduktion, (Münster: 2021, forthcoming).. 

Using the example of crowdwork in and between Germany and Romania, it can be shown that digital platforms enable German companies to engage in a new form of outsourcing to the European “peripheries,” one that builds on the historically rooted political, economic, and cultural relationships between the two countries. Although the country’s German minority currently numbers only about 40,000 people, many other Romanians are learning German to improve their chances on the labor market. In addition, many jobs on the platforms, especially in the IT sector, tend to require knowledge of English rather than German. Nevertheless, access to somewhat better paid jobs on digital platforms is limited for many Romanians.

Most crowdworkers on macrotask platforms such as Upwork have a university degree or high school diploma, foreign language skills, and are between 20 and 40 years old. Even if primarily young people with a high level of education use such platforms as a central income opportunity, the number of virtual migrants from Romania is steadily growing. At the same time, of course, many Romanians continue to take the “classic” path of labor migration to Western Europe, and are one of the fastest growing migrant groups in Germany. Approximately five million Romanians currently live and work abroad—a quarter of the entire population. How will the two forms of migration change in the future? And what role will platform companies play in the German labor and mobility regime in the long run?

With regard to the wildcat strike of Romanian workers in Bornheim described at the beginning of this article, it also remains an open question to what extent new forms of labor struggles will develop in the remote gig economy. Whereas previous efforts to organize crowdworkers have largely taken place on the digital terrain, one of the world’s first protests of digital workers “on the streets” can currently be observed in Romania’s neighboring country of Serbia. In early April, around two thousand of them once again responded to a call by the newly founded Association of Internet Workers in Belgrade to protest against a new government tax law that would cause severe financial difficulties for tens of thousands of workers. Photos from the protest show a sign reading “Nécu da odem” (“I don’t want to leave”)—a reference to the high number of people who leave Serbia as well every year in search of work abroad. The example illustrates that crowdwork platforms are already profoundly transforming not only the world of work, but also the forms and practices of migration.

This text is a contribution to the Berliner Gazette’s BLACK BOX EAST text series; its German translation is available on Berliner Gazette.

You can find more texts, works, and conference information on the English-language BLACK BOX EAST website. 

The text is based on field research in Romania that was conducted as part of the ongoing research project Digitalisation of Labour and Migration. As part of the empirical research, qualitative interviews with 38 crowdworkers in Germany and Romania have already been conducted. These crowdworkers are mainly working on the platforms Appen, Figure Eight, Upwork, Fiverr, and Microworkers.