Challenges of the Gig Economy
Challenges of the Gig Economy
- Dr. Jayantilal Bhandari
Recently, a white paper on India’s gig economy was published by the Forum for Progressive Gig Workers, following a webinar. The paper highlights the rapid growth of gig jobs and the challenges ahead. According to the white paper, India’s gig economy is expected to grow at a 17% compound annual growth rate (CAGR) and reach a value of 455 billion dollars by 2024. The paper also predicts that by 2030, the gig economy will contribute 1.25% to India’s Gross Domestic Product (GDP).
Importance of the Gig Economy
The term gig economy refers to a labor market characterized by short-term contracts or freelance work (gig work). Gig workers work on a project-by-project basis and offer their services. After COVID-19, the spread of digital platforms has catapulted the gig economy to unprecedented heights. Initially, gig workers were mainly involved in labor-intensive and low-skill jobs like construction, manufacturing, and delivery. Now, gig work opportunities are expanding into white-collar jobs, which require higher skills and education, particularly in fields like e-commerce, fintech, health tech, logistics, banking, and insurance.
Women's Participation in the Gig Economy
Women's participation in the gig economy is growing rapidly. Women are now equally involved in sectors like marketing, finance, and are particularly showing interest in freelancing. This is a positive sign for the Indian economy, as women are playing a crucial role across various industries and social contexts.
Number of Gig Workers and Their Reach
According to data from NITI Aayog, there are currently around 7.7 million gig workers in India. This number is expected to grow rapidly, especially in urban areas. It is estimated that by 2030, the number of gig workers will rise to approximately 23 million. The gig economy is rapidly expanding in both Tier-2 and Tier-3 cities, with cities like Mumbai, Delhi, Pune, Bengaluru, Hyderabad, Kolkata, Lucknow, Indore, and Chennai witnessing the creation of both direct and indirect gig jobs.
Gig Economy and Employment Generation
The gig economy is playing a crucial role in reducing unemployment rates in urban areas and creating new employment opportunities. Since gig workers often fall into the gray area between organized and unorganized labor, their benefits and resources are affected. However, companies running gig platforms such as Amazon, Flipkart, Zomato, and Swiggy are actively working to ensure better working conditions for their employees, such as providing raincoats during monsoon season, water facilities, and spaces for rest.
Social Security for Gig Workers
Although opportunities in the gig economy are growing, the issue of social security for gig workers remains crucial. The Social Security Code, 2020 has been enacted for gig workers, but it is not yet fully implemented. The code enables the government to provide gig workers with benefits like life and disability cover, accident insurance, health and maternity benefits, old age security, and childcare benefits. Additionally, the government and companies need to work together to ensure benefits like minimum wages, paid leave, and retirement benefits for gig workers.
Global Market Opportunities for Gig Workers
To expand gig workers' reach in global markets, the government should ensure arrangements for high-skill gig workers in sectors like education, financial advisory, legal work, healthcare, and customer management. Additionally, a transparent and fair system needs to be established for sharing social security benefits, which requires cooperation between governments, gig platforms, and labor organizations.
Conclusion
The gig economy in India is expected to play a significant role in generating employment in the coming years. If gig workers are provided with adequate social security and supportive policies, they will be able to contribute significantly to India’s economy. This will help reduce income inequality, promote innovation, and accelerate economic growth. As the gig economy develops, India will be able to build a dynamic workforce that will be competitive in global markets.
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