Advocacy Centre for Tenants Ontario: On Responding to Airbnb

December 5, 2017

From an ACTO blog post: In 2016, UNITE HERE's Local 75 filled Trinity-St. Paul's United Church with more than 600 rank and file members and allies to celebrate the 10th anniversary of the Hotel Workers Rising campaign, a continent-wide struggle that turned precarious work into good jobs with pensions and benefits. While wages were central to the campaign then, it is not the only issue that moves Local 75 members today.

Members have since become much more concerned about the rising cost of living. Housing costs, we were told, is the single biggest issue that keeps members up at night. Winning wage increases from one faction of capital, only to have to hand more and more of it over to another is not a win, but a loss. The fight for a better life cannot be reduced to workplace organizing, but has to include areas where unions don't venture very often, including the realm of affordable housing. Land and labour, rent and wages, we are reminded, are internally related parts that define the exploitation of workers under capitalism.

Impact of Airbnb on the Rental Housing Market

Moving on to the issue at hand. Airbnb. A company that emerged on the scene not long ago.

On the surface, Airbnb is an online service that connects homeowners with guests who are looking for a place to stay. It brokers the connection and takes a cut from the host and the guest for each nightly booking. Airbnb says that its hosts are mainly ordinary people who occasionally rent out a spare room to generate a modest amount of income to help make ends meet. It bills itself as a company that "democratizes capitalism."

In reality, Airbnb enables a shadow economy of absentee landlords and want-to-be property managers who turn residential housing stock into full-time ghost hotels. Rather than democratizing capitalism, research indicates, unchallenged, that Airbnb produces the same tendencies that define the broader economy, chief among them, the tendency towards the concentration and centralization of capital. As our Toronto study shows, a small minority of hosts control a disproportionately large share of Airbnb’s inventory and generate the majority of the company’s revenue.

The problem for hotel workers is this: Airbnb is a venture capital-fed, $31-billion “sharing” economy giant that thrives by operating in legal grey areas. Airbnb uses tax regimes in Ireland and offshore tax havens like Jersey to avoid paying taxes in Canada. Most importantly, Airbnb runs the world’s largest hotel in a vertically disintegrated manner. It spreads its ghost hotel inventory across residential communities, condo towers and apartment buildings. None of this inventory conforms to the same rules, standards and tax laws that the regulated hotel industry follows. Consequently, Airbnb is cheap and extremely popular among budget travelers, it lowers hotel room occupancies and leads to a reduction of hours for hotel workers.

Read more: On Responding to Airbnb