In August, Stefano Lombardo felt pretty good about his job: After four years of hauling pizzas and burgers through Berlin, he was one of the most experienced riders of startup Deliveroo, and the company had just promised him new gloves and a t-shirt with his Teal-tinged logo. Three days later, Deliveroo said it would shut down its operations in Germany.

Company loyalty has long been the key to the social contract in Europe’s largest economy: long – lasting, sometimes lifelong solidarity with an employer is rewarded with reliable benefits such as a company car, holiday bonuses and retirement plans. The growth of so-called gig economy jobs with the likes of Deliveroo, Uber and AirBnB threatens this deal. According to the lobby group BFB, the number of freelancers in Germany has grown by more than a third in the past decade, to 1.4 million.

German startup Helpling connects freelancers with clients who need to clean the kitchen, walk the dog or assemble Ikea shelves. Lime has an army of independent contractors he calls “juice” who pick up electric scooters, charge them at home and then throw them back on the streets in the pre-sleep time of about 5 euros per device. And Fiverr, an Israeli group that connects companies with coders, videographers and translators, is expanding in Germany.

The German company Deliveroo had about 10% of the 1,200 employees. The rest were people like Lombardo who got paid 5-6 euros for shipping. Cyclists had to supply their own bikes and mobile phones and were responsible for any repairs. Sick? Call a doctor and don’t expect to be paid until you’re back in the saddle. And the riders had no unemployment protection, so when Deliveroo announced its departure from Germany, they received only a few weeks of payment from the company.

The gig economy is redefining the employer-employee relationship just as the German growth engine is starting to sputter. Manufacturing is already in recession, and both exports and imports declined in August, suggesting weakening domestic demand coupled with a slowdown in industrial growth. A much larger service sector could follow if rising unemployment hurts consumer spending.

According to the IFO research Institute, the number of companies expecting to cut working hours – a way to cut labor costs without layoffs – tripled by roving by roving last year. And big players such as auto parts maker Continental, ailing lender Deutsche Bank and engineering giant Siemens have announced tens of thousands of job cuts since April.

“These cases indicate that the economy is entering volatile waters,” said Oliver Stetts, an analyst at the IW Institute for economic research in Brussels. “Job growth is slowly coming to an end.”

This shift comes even at a time when the number of jobs in the gig economy is growing, especially in Berlin, where dozens of startups are being created every month. Unions fear that this type of employment will spread to other parts of the German labour market, especially if the wider economy slips into recession.

Companies like Deliveroo and Lime say freelancers can help them cope with unexpected changes in customer demand, and that flexible working hours mean they can offer jobs to people who might otherwise be unemployed. And services often make freelance work more transparent and secure. In Asia, for example, an Uber-type startup called Grab offers insurance to its scooter drivers and encourages them to wear a helmet.  

Lombardo says he earned up to 4,000 euros a month before taxes. But he also got a taste of the volatility of such jobs. In mid-2017, Deliveroo switched from an hourly wage to a pay-for-delivery model. When Lombardo refused to sign a new contract and instead tried to negotiate, Deliveroo let Him go. A few weeks later, unable to find better options, he relented and signed a new agreement.

Compared to traditional jobs, there are plenty of downsides to freelancing. Experienced Uber drivers, popular AirBnB hosts, or efficient Lime juicers can’t take their rating or status with them to the next job. It’s next to impossible to build up a decent social security or pension safety net freelancing. And there’s generally no works council, a labor group mandated by German law that represents employee interests in everything from break rooms to wages. IG Metall, Europe’s largest trade union, has been warning of unfair conditions for gig-economy workers, and in July urged Google’s YouTube to give freelancers who create content for the site a better deal.

Given the growth of the gig economy, governments should create digital social security accounts for such workers, says Enzo Weber, an economist At the Institute for employment research, a government-funded think tank. These accounts will be automatically topped up with small amounts after each hamburger delivery or Uber ride, says Weber, who proposed the idea to the European Commission and Germany’s labour Ministry.

“Companies get an efficient digital mechanism, customers won’t even notice, and workers get without the hassle of social security,” says Weber.

Meanwhile, Lombardo is Cycling again. He and a couple of friends founded a food delivery collective called Kolyma2, which serves 15 restaurants. The group aims to create an egalitarian ethos – every employee, whether a rider or a software developer, has the same rights, and it is experimenting with innovative ideas such as waste-free deliveries, in which riders pick up Tupperware containers at customers ‘ homes and return them filled with food.