Tenets of Gig Economy

The definition of gig economy demands due consideration because the term is hitting the news headlines these days. The NITI Ayog released a report titled, India’s Booming Gig and Platform Economy. So, friends how can we understand the gig economy? The gig economy is an emerging sector of the labor market in which people work as freelance workers to perform a specific task like delivery of food items through such platforms as Zomato or the servicing of your air conditioners directly without using any digital platform. This type of employment is outside of the traditional employer-employee relationship. There is no boss-subordinate relationship in this case. The charges or fees for these services are also negotiable. This employment is flexible and shows the characteristics of self-employment. This type of employment creates a new age category of workers being famously called gig workers. Some other names are also used like platform workers, on-call workers, independent workers, and so on. There are several factors for why this economy is gaining more and more importance nowadays.

So let’s understand why the India’s Booming gig economy is getting more and more importance. The most important aspect of this employment is the flexibility of time. A gig worker can determine his own time for performing a task. This becomes advantageous for those who want to earn extra income while continuing their main activities. The digitalization of economies is another factor contributing to the emergence of the gig economy. According to NITI Ayog ‘s report, the total digital transaction volume had increased to INR 4,371 crore from INR 3,412 crore in 2019-20. As per the ILO, nations within the BRICS consortium have experienced gigantic progress within internet connections as well as in the utilisation of devices that are internet-enabled. Thus, the increasing digitalization is a big supply-side factor for the evolution of this sector. Still another important factor is the nature of self-employment. A gig worker is outside of the traditional employer-employee relationship. This employment is quite beneficial for women as well.

So, how this employment is beneficial for women. Women need flexibility in employment as they are mostly engaged in the so-called care economy of their families for unpaid work. They need the flexibility of time because of their various household responsibilities. The gig economy provides that flexibility. Thus, the gig economy can play a significant role in the economic empowerment of women. Some studies indicate that women increase the income potential of the gig economy and are also its major beneficiaries. Despite this, access to Internet services and digital technology can de a restrictive factor. According to GSMA mobile gender gap report 2021, only 25% of women own a smartphone compared to 41% man in India in the year 2020. We need to remove this Internet and digital gender inequality. Dear students, finally, we need also to understand the challenge put forth by the gig economy.

So, what are the challenges put forth by the gig economy? The first and foremost challenge is the informalisation of the labor market implied under the idea of the gig economy. Since, in the gig economy, we do not see the traditional employer-employee relationship, the outcome is the generation of informal employment. Informal employment is against labor welfare. Gig workers do not benefit from labor regulations relating to wages, hours, working conditions, etc. They can also not take the benefit of collective bargaining because they are not members of labor unions. They do not get social security. The NITI Ayog in its recent report (as mentioned above) called for the coverage of the gig workers in social security programs in India. Second, there are issues of accessibility. Access to internet services and digital technology is difficult in rural and remote areas. This is the reason that the gig economy is largely an urban phenomenon. Third, occupational safety is another concern. According to some ILO surveys, about 83 percent of workers engaged in the app-based taxi sector and 89 percent in the app-based delivery sector reported safety concerns related to road accidents, theft, physical assaults, etc.