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Gig Economy

  • Published
    23rd Jan, 2024
Context

The report on the Future of Work highlights that Gen Zs and millennials prefer gig roles due to flexible work locations and a emphasis on specialized skills.

Key Highlights

Key Highlights of the report –

  • Future job landscape: Firms are focusing on geographical expansion for talent exploration and strategic partnerships for competitive advantage and market access.
  • Tier 2/3 city prominence: Expansion into smaller cities gains traction for harnessing untapped innovation potential and diverse talent pools.
  • Drivers for expansion: Small organizations prioritize talent availability and cost savings, while larger tech firms focus on diverse skill sets and untapped talent in emerging technology hubs.
  • Industry transformation: The tech industry in India undergoes significant transformation, shifting from traditional offices to exploring remote work and adapting to evolving workspace dynamics.
  • Balance in the future of work: The evolving work landscape will be defined by a dynamic balance between efficiency improvements from automation and the expansive potential of creativity through continuous innovation.

What is gig economy?

  • As per the World Economic Forum (WEF), gig economy is defined by its focus on workforce participation and income generation via “gigs”, single projects or tasks for which a worker is hired.
  • Gig economy includes all platforms that hire independent workers across sectors like e-commerce, technology, food & beverages, home services among others.
  • Gig workers are typically hired by companies on a contractual basis and are not considered employees. They do not receive some of the benefits that on-roll staffs do.
  • Classification: Gig workers can be broadly classified into:
    • Platform workers: Those whose work is based on online software apps or digital platforms such as food aggregator platforms Zomato, Swiggy, Ola, and others.
    • Non-platform-based workers: Casual wage and own-account workers in conventional sectors, engaged part-time or full-time.

Benefits of Gig Economy:

  • For Workers: Gig economy can provide more flexibility, autonomy, income opportunities, skill development, and inclusion.
  • For Employers: It can enable access to a large and diverse pool of talent, lower fixed costs, higher scalability, and better customer satisfaction.
  • For Customers: It can offer more choice, convenience, quality, and affordability.

Current trend in the Indian Economy-

  • about 47% of gig work is in medium skilled jobs
  • about 22% in high skilled
  • about 31% in low skilled jobs

The trend shows the concentration of workers in medium skills is gradually declining and that of the low skilled and high skilled is increasing.

Expected trend

  • While in 2020-21, the gig workforce constituted 2.6% of the non-agricultural workforce or 1.5% of the total workforce in India, by 2029-30, gig workers are expected to form 6.7% of the non-agricultural workforce or 4.1% of the total livelihood workforce in India.

Significance of Gig Economy in India

  • Boosting Employment Opportunities: In India's quest to provide employment opportunities, the gig economy plays a crucial role by expanding job availability and enhancing labor force participation.
  • Addressing Skill Diversity: Approximately 47% of gig work involves medium-skilled jobs, 22% in high-skilled roles, and 31% in low-skilled positions, catering to a diverse range of skills in the workforce.
  • Youthful Demographic Advantage: With a large population of educated and tech-savvy youth, India leverages its demographic dividend, as many millennials seek the gig economy for its flexibility and work-life balance.
  • Empowering Female Labor Force: The gig economy benefits female workers by providing income-generating opportunities, choice, and flexible work arrangements, leading to an increase in women's participation from 18% to 36%.
  • Post-Retirement Opportunities: Contract work's flexibility attracts retirees, enabling them to continue working on their terms even after retirement.
  • Democratization of Job Opportunities: The gig and platform sector, characterized by low-entry barriers, holds significant potential for democratizing job opportunities and fostering inclusive job creation in India.
  • Technological Advancements Driving Change: Rapid technological advancements, especially in AI, robotics, and data analytics, eliminate workplace limitations, enhancing productivity and improving the living standards of gig workers.
  • Revolutionizing Last-Mile Delivery: The gig economy has revolutionized the last-mile delivery industry, making it more accessible, affordable, and efficient through innovative work models.
  • Facilitating Remote Work: Telecommunications have made work more dynamic, enabling collaboration irrespective of geographical constraints, fostering the growth of remote work.
  • Enabling Start-Up Culture: Gig workers serve as a cost-effective alternative for businesses, allowing project-by-project hiring without the obligation of providing traditional employee benefits.
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