Gig economy is a system that is based on flexible, short-term, or freelance work. It might involve contacting clients or customers on online platforms. Individuals who are part of the gig economy are called gig workers, who are frequently employed by businesses on a contractual basis but are not regarded as employees.
Gig workers can be divided into platform and non-platform workers. Platform workers are those whose jobs rely on digital platforms or online software apps such as Zomato, Ola, Uber etc. On the other hand, non-platform gig workers typically are casual wage earners and can work either full-time or part-time.
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Why in the news?
On 27 June, 2022, the NITI Aayog released a report titled ‘India’s Booming Gig and Platform Economy’. The NITI Aayog has suggested fiscal incentives, including tax breaks or startup grants, for businesses that employ roughly one-third women and persons with disabilities (PwDs).
Overview of the NITI Aayog Report on Gig and Platform Economy
Important facts given in the NITI Aayog report titled ‘India’s Booming Gig and Platform Economy’ are given below:
- According to the Report, the gig economy employed more than 7.5 million people in 2020–21.
- In the following eight years, the number of workers employed will increase to 23.5 million workers, accounting for 4.1% of all Indians’ means of subsistence.
- The Report states that at the moment, medium-skilled occupations make up about 47% of gig work, high-skilled jobs make up about 22%, and low-skilled employment make up about 31%.
- Women are more likely to work in platform positions after getting their education and getting married, according to a survey done in urban areas of India.
- In India, the female labour force participation has remained low, ranging from 16 to 23 percent in recent years.
- The labour force participation percentage for persons with disabilities, who make up 2.11 to 10% of the population in India, is 36%.
- The participation of the two demographic groups in the labour force has been hampered by structural impediments like access to education and a lack of skills.
- As per the Report, platform companies empower workers to monetise their idle assets when and where they want — a benefit lacking in traditional employment sectors — offer flexibility and choice of labour to all workers in general, and women in particular, according to the report, making them an appealing opportunity for both groups.
- The Report suggests businesses to implement old age or retirement plans, as well as additional insurance coverage for contingencies like injury sustained at work that could result in loss of job and income.
Advantages and Disadvantages of Gig Economy
The gig economy has its advantages and disadvantages. These are given below:
Advantages
- It makes the work more adaptable to the requirements of the employee and the employer.
- It promotes a flexible lifestyle.
Disadvantages
- As the employees are frequently employed by businesses on a contractual basis, they mostly do not receive allowances like paid sick, housing and travel expenses, provident fund etc.
- Some platform gig workers may receive low wages and there is lack of job security.
- There may be no scope for upward mobility within the firm or institution.
- There is unequal gender participation in such platforms.
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