The rise of the Gig economy

What Is Gig Economy

The gig economy can be described as a system where on one hand, there is a service seeker, i.e. a customer with a demand for a specific task, and a service provider, i.e. a gig worker, on the other hand, who can perform that particular task. Tech-enabled platforms in this economy connect customers to the gig workers to hire services on a short-term basis. Self-employed, freelancers, individual contributors, and part-time staff comprise gig workers.

A topic that illuminates the interest of many, it might turn up as a topic for group discussion during your admission or placement interviews. So, let’s critically analyse the topic – “Will Gig economy drive the future of employment”?

We know that the conventional economy consists mostly of long-term workers who work for one employer, generally, within the driving distance of where they live. The gig economy consists of short-term freelancers in close proximity to those who hire them with no regional boundaries.

As a result of need and convenience, the conventional job market was born. The only way to be employed before the internet, and even before (reliable) mass transportation, was to find a business that would offer you steady, long-term employment, located close to where you lived. This was not because it was the best option, but because it was the only choice available and so, it later became the norm. That has and will continue to change technology.

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Factors affecting the traditional job system

The Internet: Now that most of the first-world countries have access to high-speed internet, work opportunities are opening up beyond the immediate geographic area.
- Today, without ever being near the company, a person can find a job, apply for the same and get hired.
- In addition, a gig worker can also get training to specialize in just about any field of business they choose, from anywhere in the world.
Competition: The pressure of rising demand is continually felt by businesses. This causes corporations to have to squeeze every rupee to boost earnings. It is simpler and cheaper for businesses to recruit freelancers to work remotely without the extra cost of recruiting an employee and onboarding them. Freelancers do not need office space, insurance, reimbursements for expenditures or any of the other variables needed by employees.

Reasons for Indian economy accepting short-term labor

There can be many reasons as to why the companies are more and more tempted to recruit talent, especially the white collared one, for a shorter term.

First, there is the obvious reduced cost of recruitment, which comes at the cost of providing benefits in the form of maternity, provident, medical, etc. But none of this has to be provided for the person working for you miles away in front of electronic devices.
Second, the requirement to have a lavishing private space to get your employees on board is done for, as the ones doing the job in the 9 hours of shift move towards the ones who can actually get it done in a fixed time period which the employer and employee have agreed upon.

The example of Ola and Uber Workforce, or Unacademy Educators who get a contract each month to keep it flexible for the organization explains this the best.

The Pros or Benefit of Gig Economy

The gig economy has started the environment of competition and efficiency among the workers. The recruiters get some freelancers on board, and a healthy competition is promoted among them for extra money for the best performers.
Secondly, the organizations save on the time involved in training, as the ones having a prior experiences are given the gig on a contractual basis. This reduces the often increasing costs that comes with operations in office spaces.
Further, it helps the employees in having the peace of mind and freedom to work as per convenience.
Along with this, no fixed working hours, no employment policies, and no office-politics further helps them work without the obvious pull downs. The flexibility to pick and choose any kind of work helps them. Small businesses operate like a globalized corporation by tapping these talent pool.
The best thing is that in a country like India where metropolitans have not been safe for females, they get an option to pursue their career. Along with that, the ones managing their family don’t miss out on important milestones.

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The Cons or Negatives of Gig Economy

While the positives of the move have been listed, like all things that exist, there is a different side to the gig economy.

There are no regulations or legislations in order to regulate the way the gig economy functions in India. But it is expected that the government would take notice of this.
The working hours sometimes get very hectic, and adding to that, the surmounting pressure to get the task done because of reasons which are as silly as deficiency of work which was to be completed by an in-office employee almost gets on the nerves.
There are no places to raise concern, as grievance redressal mechanism is seldom mentioned in the contract. Workers generally don’t have a bargaining power to negotiate a fair deal with their employers.
When a Freelancer wants to get back to a full-time job, it becomes difficult to reach to a “CTC” or Salary package, considering how the market currently gives a hike on the current package.
The recruiters face an issue regarding the confidentiality of a product that they are launching. A freelancer being used by competition may result in conflicts and legal issues.

Conclusion

The need of today is basic labor protection. Are the ones being a part of the gig economy doing all this for social security benefits? Let’s look at it this way. Not only are the companies benefitting because of the obvious benefit that they are extracting from the ones doing the gig from them, it is helping them grow bigger. The regulations are still not in place and hence the laws are defined by the employer, and hence inclined in favor of them.

But the fact that such regulations will only cripple an emerging market which is still in nascent stage is also true. It has a lot to mature upon.

The government can always redefine the terms of labor laws to accomodate the gig economy, but make sure this doesn’t stifle innovation. India could be a stakeholder with European Union and the USA, where talks are underway on ways to protect the gig.

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