Rise of Gig Economy in India - PDF


Added on  2021-03-01

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Political Science
Rise of Gig Economy in India - PDF_1

Today, economic commentators in India have busied themselves with finding the ways to deal withthe unemployment crisis that resulted from COVID-19. We saw that for labour flocking back to ruralIndia, employment support came in form of an increased outlay for MGNREGA. In several Indiancities however, shuttered businesses have meant that millions of workers have either had to leave orhave had to take up new forms of work, with some finding the burgeoning gig economy to be theironly source of employment.1The pandemic, which also pushed millions of people indoorsnecessitating remote working or ‘work from home’, emerged as an add on to the already existingforces of globalisation and the age of digitalisation, that has redefined the ‘future of work’ in India inrecent years. In this context, the study of gig jobs and the quality of lives they provide for, which hasthe potential to contribute to achievement of Goal 8 of Sustainable Development Goals i.e. ‘decentwork and economic growth’, gains prominence. The paper is divided into four sections. The first section deals with the meaning of gig economy andhighlights the forces that led to its rise in India. In the second section, the practical challenges facedby gig workers are examined. The third section explores the gender dynamics in the gig economy.And the fourth section examines the recent policy measures adopted by government to address allthe challenges. Finally, the conclusion offers some public policy options that can be adopted for anefficient gig economy to thrive in India. RISE OF GIG ECONOMY IN INDIABefore starting off with rise of gig economy in India, we need to know what exactly a ‘gig economy’is. Gig economy2 is a free market system in which temporary positions are common andorganizations contract with independent workers for short-term engagements. It offers two workmodels: (a) ‘crowd work or online freelance work known as digital gig economy’ (b) ‘work on-demand via an app known as physical gig economy’.3Today, India’s gig sector is expected to grow to $455 billion by 2024 at a compounded annual growthrate of 17 per cent—with potential to grow at least double the pre-estimates for the post-COVID-10pandemic period.4 The pandemic which pushed millions of people indoors necessitating remoteworking or ‘work from home’ is just an add on to the already existing forces of globalisation and theage of digitalisation, that has redefined the ‘future of work’ in India. The reasons behind tectonic shift in the workforce from conventional setup to gig work can beunderstood only by looking at various benefits gig work provides to the workers. Gig work givesworkers the independence and flexibility to choose their work, that is, opt for preferred job rolesand organizations the number of work hours and holidays providing them the potential to havework-life balance in their routines and choose the kind of work that they find to be meaningful. Itallows them an opportunity to work in diverse roles and enhance their portfolio. Furthermore,people who wish to supplement their earnings from their primary job also turn to gig work. Manyfemale workers have turned to gig work in recent times, as it allows them to be able toaccommodate care activities alongside work and diminishes the importance of physical presence,1 Samuel, J., Quality gigs, a solution to urban unemployment, The Hindu, January 5, 2021.2Gig economy is also called platform economy or shared economy. 3Crowd workers include workers offering various services according to their skill sets and talents, such as graphicdesigners, software developers, content writers, translators, digital marketers and data scientists, among others. On-demand work include personal transport services offered by Uber and Ola, the food delivery services provided by Zomatoand Swiggy etc. At present, most companies and people around the world, including those in India, are increasingly adopting these newertechnologies and flexible work practices, leading to the expansion of gig economy.4 Hiranandani Niranjan, Growth of gig economy signals tectonic shift in the workforce, The Week, December 10, 2020.
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which is a mainstay of standard employment relations. Millennials, or Generation Y5 are guided bythe mindset that autonomy in choosing their career path and personal fulfilment precede the needfor stability gained from regular employment. Gig economy is also emerging as an easy solution forreaching out to the ‘untapped potential’- unemployed youth, NEET youth who are interested injoining the workforce but are not able to overcome barriers to their entry. From the point of view of firms and companies, the gig economy and gig work allow them to cutbusiness costs related to insurance coverage, office space, health benefits accorded to full-timeemployees. For businesses, the key risk lies in the creation of gap in talent, but this risk is minimizedunder the gig economy as they have access to a global pool of talent. Skilled workers and specialistsperform jobs on a contractual basis, according to pre-decided timelines and in a cost-efficientmanner. But the real-life implementation of the gig model has come with the cautions and ridersattached to it which are explored in the next section. CHALLENGES OF GIG ECONOMYDespite its various benefits, gig work has led to severe commoditization of work opportunities,leaving workers vulnerable to exploitation. In the gig economy, instead of being accorded the statusof an employee, workers are viewed as ‘independent contractors.’6 Unlike full-time employees, theyare not included in the monthly payrolls and social protection benefits (e.g., insurance, medicalleave, provident fund, maternity/paternity leaves, etc.) offered by companies. These difficulties areoften enhanced by the lack of direct communication channels which the workers have with theircompanies.7 There is often a lack of ability to communicate with other workers in order to gain acollective voice and enhance their bargaining power. This leaves workers often having no influenceon decisions regarding employment practices and rights of employees. While highly skilled and well-paid freelancers cansave and buy personal insurance from the private sector, workers inunorganized/informal sector are left without any protective measure, as they cannot affordinsurances provided by the private sector and do not qualify as beneficiaries in those provided bythe public sector. In such cases, job insecurity coupled with financial instability can be a source ofmajor stress for such workers. Many gig workers might find themselves working in extremely poorworking conditions—long hours with no fixed working hours, no protection against unfair dismissal,no right to redundancy payments and no right to receive the national minimum wage, paid holidaysor sickness pay. It is common for a variety of other safeguarding measures to be breached.8There is no denying that outbreak of the COVID-19 offered opportunities that fastened the pace ofrise of gig economy. But at the same time, it exposed and even widened some of the existing faultlines in the gig economy. In order to ensure a sense of normalcy during the social isolation, peopleincreasingly became dependent on a large fleet of delivery workers operating at the frontline, alsooffering door-to-door delivery of essentials along with food delivery. Despite relying heavily onworkers, it became evident that the platforms have had little or no plans in place for workers’ safetyduring this crisis. There was a shortage in supply of sanitisers and masks, making the workers moresusceptible to contracting the virus and thus becoming ‘super-spreaders’ of corona virus. Even after5Millennials, or Generation Y, are the group of people who were born between 1980 and 2000.They comprise 34 per cent of India’s population and represent 45 per cent of the Indian workforce. 6As opposed to permanent jobs, their employment is characterized by a short-term contract.7 Mehta, Balwant, Changing Nature of Work and the Gig Economy: Theory and Debate, Sage Journals, 2020, p.8.8The Fairwork Project initiative, which is led by Oxford University researchers, revealed that app-based service companies such as Ola, Uber, Uber Eats and Zomato have some of the worst workingconditions among Indian start-ups. Even though these companies pay the local minimum wages totheir workers, the status quo established is not ideal for workers.
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