The Gig Economy In India: A Double-Edged Sword

(MENAFN- Kashmir Observer)
Representational Photo

By Narayanan Kizhumundayur

The rise of the gig Economy in India represents a profound transformation in the country's labour market. Enabled by rapid digitization, growing smartphone usage, and platforms like Uber, Swiggy, and Zomato, millions now perform short-term“gigs” without formal employment. This shift promises flexibility for both businesses and workers, offering companies an on-demand workforce while allowing workers immediate earnings. Yet, this transformation has a dual nature: while it offers flexibility and income opportunities, gig work also brings challenges, such as the lack of stable employment and security.

Many gig workers, especially younger individuals, are drawn by the freedom to choose when, where, and how much they work. Gig work allows them to balance multiple jobs, pursue education, or meet family obligations, often with minimal entry barriers. For instance, a Swiggy delivery worker can begin earning almost immediately, with just a bike and smartphone. The gig economy has also created opportunities for women and marginalized communities who may lack access to traditional employment, offering pathways to financial independence. Many women now use freelance platforms for home-based work like content creation, graphic design, or tutoring.

However, this flexibility comes with trade-offs. Gig work is often precarious, with workers lacking basic labour rights such as minimum wage, social security benefits, or healthcare. This“invisible workforce” exists in a grey area, neither fully employed nor fully independent, and thus lacks the legal protections afforded to regular employees. Without health insurance, pensions, or paid leave, gig workers are left vulnerable, especially during times of illness, injury, or personal crisis. Furthermore, algorithms that control gig work-whether for ride-sharing or food delivery-are opaque, making earnings unpredictable. A driver for an app-based cab service, for example, might see earnings drop overnight due to changes in the platform's commission structure, with little recourse.

Critics argue that the gig economy's model relies on exploitation, classifying workers as“independent contractors” to avoid paying employee benefits. Although platforms exert significant control over workers' tasks and performance, they evade the costs and obligations of formal employment. Many gig workers work long hours for low pay, without any say in their terms of employment. In the absence of labour regulations suited for gig work, exploitation continues, with food delivery workers often working 12-hour shifts to meet minimum earning thresholds. The competitive nature of gig work further drives down wages, as platforms benefit from a large labour pool willing to endure poor conditions for a living.

Despite these challenges, the gig economy in India is projected to grow, potentially employing over 90 million workers by 2028. To ensure that growth benefits both workers and the economy, policymakers need to address the existing gaps in legal and social protections for gig workers. The government has introduced the Social Security Code, 2020, which aims to extend certain benefits, such as life and disability insurance, provident fund schemes, and maternity benefits, to gig workers. However, effective implementation is critical.

Additionally, the private sector must play a role in ensuring fair wages and benefits for gig workers. Platforms could explore profit-sharing, offer basic health insurance, or allow workers to form associations to negotiate better conditions. Without addressing these issues, the gig economy may become unsustainable, leading to workforce dissatisfaction and potential labour conflicts. To make the gig economy a pillar of India's labour market, a balanced approach is necessary-one that combines flexibility with the rights and protections workers need for economic security.

• Views expressed in the article are the author's own and do not necessarily represent the editorial stance of Kashmir Observer

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