1. AIRBNB AS AN INCOME SUBSTITUTION IN SLOVAKIA InGRID WINTER SCHOOL FROM UBER TO AMAZON MECHANICAL TURK: NONTRADITIONAL LABOUR MARKETS DRIVEN BY TECHNOLOGICAL ORGANISATIONAL CHANGE SILVIA HUDÁČKOVÁ

2. Introduction More than 307 000 people are actively searching employment in Slovakia. Only 803 people in Slovakia rent through Airbnb In 2014, 90,4% of Slovak households owned the property they lived in. Most Slovak households are able to use their real estate as asset. Renting a room through Airbnb could help households to improve their income, e.g. during times of unemployment. + wide regional disparities in income

3. Research questions How many nights of renting a whole piece of real estate/single room/shared room is needed for a person with the median income during a period of unemployment to earn enough to maintain their standard of living? In how many days is it possible to substitute the median income with Airbnb altogether in each of 8 regions with each type of rentals – whole piece of real estate/single room/shared room?

4. Methods In order to compute days needed to substitute the income gap and median income in each region I need to obtain: –median income in each region –social benefits from median income during unemployment for each region –compute the income gap –Airbnb terms and conditions/fees –Data from Airbnb price per day and the type of rented place (whole piece of real estatet/single room/shared room) for each region compute average for each region –average price/day of house or apartment/room/shared room in each region.

5. Data Median monthly wage Monthly welfare benefits during unemployment assuming a previous job with the median income (first 6 months of unemployment) Gap between previous income while employed and social benefits (EUR) Bratislava region898442.8455.2 Trnava region715352.7362.3 Trenčín region684337.4346.6 Nitra region655323.1331.9 Žilina region698344.3353.7 Banská Bystrica region676333.4342.6 Prešov region617304.3312.7 Košice region719354.6364.4 Slovak republic718375.8342.2 Source : Statistical office of the Slovak republic 2013, author. Table 2 Median wage in Slovak regions, social benefits and gap between median income and social benefits (2013, in EU)

6. Data Source: AirbnB, author Average price of whole place in each region Price per day (EUR) Average price minus 3 % Airbnb fee Number of cases Bratislava62,6460,76231 Trnava92,8590,0626 Zilina80,2577,84118 Nitra45,1743,8118 Kosice62,4260,5533 Presov70,5168,3996 Banska Bystrica64,8362,8941 Trencin50,248,6915 Slovakia68,1866,13578 Table 3A Average price of renting of all types of real estate in each region through Airbnb Average prices range from 35,77 EUR in Nitra to 72,21 EUR in Trnava. Airbnb charges the host by 3% host service fee according to its terms and conditions that needs to be deduced from the rental price.

7. Data Average price of whole place in each region Price per day (EUR) Average price minus 3 % Airbnb fee Number of cases Bratislava62,6460,76231 Trnava92,8590,0626 Zilina80,2577,84118 Nitra45,1743,8118 Kosice62,4260,5533 Presov70,5168,3996 Banska Bystrica64,8362,8941 Trencin50,248,6915 Slovakia68,1866,13578 Source: Airbnb, author. Table 3B Average price of renting a whole place in each region through Airbnb We can rent a place in Trenčín almost two times cheaper than in Trnava.

8. Data Average price of single room in each region Price per day (EUR) Average price minus 3 % Airbnb fee Number of cases Bratislava28,9128,0464 Trnava30,229,2910 Zilina38,4737,3234 Nitra23,9223,2012 Kosice40,3339,1215 Presov39,4238,2443 Banska Bystrica25,4224,6625 Trencin2019,405 Slovakia32,6431,66208 Source: Airbnb, author. Table 3C Average price of renting a single room in each region through Airbnb Prices regionally vary from 20 EUR to 40,33 EUR.

9. Results Table 4 Days needed to substitute the unemployment benefits to full median wage by renting. A. whole place, B. single room 4A 4B Source: Airbnb, author.

10. Results Income gap relatively easy to substitute 4.02 to 7.58 days of renting a whole place in all regions Still realistic - 8.18 – 17.87 days of renting a single room

11. Results Table 5 Days needed to substitute full median wage by renting. A whole place, B. single room. Source: Aibnb, author 5A 5B

12. Results On average, it takes 10.84 days to substitute the median Slovak income, with the regional range of 7.94-14.95 days. To substitute the median income with a single rented room is more difficult- 22.68 days (Prešov, Košice, Žilina), and seems too difficult in Bratislava and Trenčín (more than 30 days).

13. Conclusions Airbnb brings a great opportunity for income security to Slovak home owners. Relatively easy for a host to rent a place for 4.02 - 7.58 days in all regions to earn the wage gap caused by unemployment 7.94-14.95 days to earn the median income by renting the whole house or apartment (Prešov, Trnava, Žilina- on average 9 days or less)

14. Limitations and discussion Only offer side of Airbnb examined. Returns depend on other variables, too, such as competition on the market, demand in each region or capability of the host to advertise well, as well as their ability to leave home for some time How many hosts in Slovakia make renting a piece of real estate through Airbnb their primary source of income. Slovaks do not exploit this opportunity on a large scale. A brief look at neighboring Czech Republic that has twice the number of inhabitants shows a very different scale of Airbnb business Why Airbnb in Czech Republic is thriving much more than it does in Slovakia?

15. Thank you for your attention! Silvia Hudáčková