The joys and perils of the gig economy

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The joys and perils of the gig economy

Friday, 17 January 2020 | Balwant Mehta/ Simi Mehta/ Arjun Kumar

The nature and quality of jobs generated for women in the freelance workforce need to be examined so that appropriate policy suggestions can be put forward for policymakers to make informed decisions

The participation of women in the workforce in India is one of the lowest in the world at around 21 per cent  compared to the global average of 48 per cent. And it has been declining steadily over the last two decades mostly on account of the agricultural sector. Some of the key reasons for low work participation of women in the country are a disproportionate burden of care-giving and domestic duties, rising income of households, absence of suitable jobs, patriarchal social norms and poor working conditions. In fact, women’s participation in care-giving and domestic duties in the country is highest among all the nations across the world.

The labour force participation rate (LFPR) of women declined more in rural areas, while it was almost stable or marginally up in urban areas in the last few years. Over the years, the rural and urban gap in the LFPR of women narrowed and then converged in 2018. Agriculture distress, low payment in unorganised sector jobs and rising participation of women in higher education are leading to increasing migration to urban areas in pursuit of better jobs and opportunities. These trends could have significant implications in the Indian context as women in urban areas are increasingly participating in new-age  jobs, particularly those that are technology-based such as flexible work on information technology and other digital platforms called the gig economy.

This is helping women maintain a work-life balance and accommodate disproportionate care activities by reducing reliance on physical space and presence and giving them the option to choose their own working hours and tasks.

This phenomenon has been brought about by technological innovation. The ownership and access to computers, tablets with internet and smartphones — some of the prerequisites for active participation of people in the gig economy — has increased manifold in India in recent years. This has encouraged more women to participate in the gig economy, particularly from urban and peri-urban areas.

According to the Employment Outlook Report, by staffing platform TeamLease, women gig workers accounted for about 68,000 jobs in the country in 2019 and the gig economy is expected to generate more jobs in the future. It is estimated that it will comprise half of the urban workforce by 2025 and as much as 80 per cent by 2030.

The increasing participation of women in the gig economy will not only empower them financially but also steer the economic growth of the country. As reported by the McKinsey Global Institute, if India increased the workforce participation rate of women by ten percentage points by 2025, its Gross Domestic Product (GDP) could rise by as much as 16 per cent as compared to the business-as-usual scenario. A recent report on the Future of Work Anywhere-Gig Worker by Noble House revealed that men and women have  almost a 50:50 participation in the gig economy against the traditional workforce where the ratio is about 70:30.

About 86 per cent of women gig workers in India believe that this kind of arrangement gives them an opportunity to earn equal to their male counterparts. The 2019 Employment Outlook Report reflected that the new-age internet companies were seeing more women in frontline roles. It is easy to see why, given the lower attrition rates, better ratings for delivery women and improved productivity at warehouses. This has led to greater demand for women at delivery hubs and fulfilment centres.

Another study done by BetterPlace (2019) reveals that the number of women entering the gig economy is rising. Online companies such as Amazon and Flipkart that have begun to hire women in delivery roles have also seen better acceptability by customers. Besides, food-delivery apps such as Swiggy and Zomato have also employed several thousand women employees in cities like Kochi, Jaipur, Pune and other Tier 2 cities.

However, the much-debated issue in the gig economy is the growing concern regarding availability of decent work and violation of fundamental rights of workers. Under the gig economy, the demand for workers and supply of opportunities are matched online or via mobile applications. Though the gig economy provides good job opportunities and allows for flexible working schedules for women, it can also pave the way for severe commoditisation of work that forces people to choose transient work in the absence of better options. They are also vulnerable to attacks and exploitation. 

Flexible work and the possibility of combining paid and unpaid work could provide opportunities to women involved in care-giving activities but could also lead to the deterioration of their working conditions and increase in working hours, given the requirement of constant availability to both duties of care-giving and paid work.

While more women are joining the gig economy, they are paid less than men for the same jobs. As much as 60 per cent of the jobs are in food technology, 30 per cent in e-commerce and courier services and 10 per cent in hyper-local delivery. Another study done by BetterPlace (2019) reveals that challenges remain when hiring them for frontline roles, especially with regard to their safety.

The Fairwork Project Initiative shows that app-based service companies such as Ola, Uber, Uber Eats and Zomato have some of the worst working conditions among Indian start-ups. These companies were ranked on five principles of fairness and score only two-four out of 10. The only positive is that they paid at least a local minimum wage including employment costs incurred by the workers. It is also argued that the new work culture within the gig economy is not activity regulated and women face the possibility of being disadvantaged all over again.

The nature and quality of jobs generated for women under the gig economy need to be examined so that appropriate policy suggestions can be put forward for  policymakers to make informed decisions. It would further provide an improved understanding of the realities of flexible work arrangements in both crowd work (digital marketing, online tuitions, content writers, translators, graphic designers, freelance recruiters, software development, accounting, data analytics, legal work, medical transcription, health workers and social work) and on-demand service work (such as personal transport services offered by Uber, Ola, food delivery services provided by Zomato, Swiggy and e-commerce services of Amazon, that require a direct interface between workers and those requesting for gig services) to fill the critical knowledge gap.

(Balwant Mehta is a Fellow at the Institute for Human Development and a Visiting Fellow at the Impact and Policy Research Institute (IMPRI), while Simi Mehta is CEO and Editorial Director and Arjun Kumar is Director at IMPRI)      

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