Demographic dividend will be empty talk unless government builds sustainable gig economy
Posted Date – Monday, 01 May 23 at 12:30pm
Arun Sinha
Hyderabad: Now, uniformed delivery “supervisors” on scooters with boxes of packages on their backs are as common as a bird flying across the ground from one place to another. Delivery Supervisor makes our lives easier. If we live like kings and queens today, ordering things that sit on our couches and demanding they produce before us without delay, we have to trust them. Life has never been better for us as consumers. But is life good for a delivery executive, too?
Ask Blinkit’s Delivery Executives who serve clients in the Delhi-NCR area which includes Delhi, Gurgaon, Faridabad and Noida. They will say that their life is not good.
Blinkit, the online grocery platform of online food delivery platform Zomato, abruptly reduced the fee per delivery from Rs 25 (Rs 32 during peak hours) to Rs 15 in early April. They are already deprived of paid holidays, sick leave, health insurance, accident insurance, provident funds or pensions. On top of that, their monthly income dropped by 40%. They staged a two-week strike that forced Blinkit to suspend its delivery service.
pure contractor
The problem is not specific to Blinkit. Fulfillment executives of all online delivery platforms face similar issues. The source of their conflict with employers is the definition of “delivery executive” itself. Employers define delivery executives as “contractors” or “partners,” not employees. They say they are charged per unit for the services they perform, not monthly or daily. Of course, they are right. Delivery executives cannot expect to be considered permanent employees. However, they also cannot be considered yoke animals.
They are people. They must receive adequate fees, paid vacation and health, accident and life insurance, among other benefits.
It’s not just online platform delivery executives who reap these benefits. They are just a handful of workers making a living in India’s booming gig economy. Gig refers to temporary work performed on demand. Delivering restaurant food, groceries, or medicine is a job. Taking passengers from one destination to another in an Uber or Ola taxi is a show. Providing household services such as cooking, carpentry, nursing, cleaning, repairs, tutoring, child care, massage, facials, or electrical or air conditioning repair is also a job. Playing music or taking pictures at a wedding is also a gig.
Working on road and bridge projects, housing projects, and software development projects is a job. Working in logistics and transportation as drivers, stevedores and helpers is also a job. Gig workers are not only found in retail, infrastructure, housing, IT and ITeS (IT-enabled services such as call centers), logistics and transport. There are also gig workers in manufacturing.
hire and fire
There is no sector today without gig workers. Many gig workers now rent out their services through freelancing platforms. These workers may go by different names: casual, contract, casual, daily wage, casual or freelance. But the terms of their employment are the same: They are hired on demand, and if there is no work available, they are fired.
The number of gig workers across industries in India is growing exponentially. A 2020 report by the Brand Equity Foundation of India estimated that the proportion of gig workers in the FMCG-Pharmaceutical industry will soar from 15% to 69% in the next five years, and from 35% in manufacturing to 65%, among BFSI (bank , financial services and insurance) industries increased from 32% to 56%, services industries increased from 47% to 76%, and IT and ITeS industries increased from 57% to 60%.
The process of hiring gig workers started before the spread of Covid. But the pandemic accelerated it in a dramatic way. Many companies realize that there are advantages to hiring contract, temporary, and part-time workers rather than permanent workers. It reduces the cost of buying or leasing office space, paying overhead, staff training and skill spending.
If the vehicles of the gig economy must roll on sturdy wheels, employers must create a hospitable and happy environment for workers. They can’t keep cutting unit wages to workers like Blinkit did and expect them to feel fulfilled and loyal. They must provide them with paid holiday and sick leave and enable them to access health benefits, accident and life insurance, provident funds and pensions.
social Security
In 2020, the central government passed the Gig Worker Social Security Law, which provides for life and disability insurance, accident insurance, health and maternity benefits, old-age security, and other benefits. Employers are unwilling to pay these benefits. Governments need to take steps to incentivize them to enforce the code. One way to motivate them is to combine government social security schemes such as Pradhan Mantri Jan Arogya Yojana, Pradhan Mantri Suraksha Bima Yojana and Pradhan Mantri Jeevan Jyoti Bima Yojana with employers’ schemes. The Rajasthan government has taken a major step by proposing to pass a law to create a Gig Workers Welfare Board. Both central and state governments must do more to protect the interests of gig workers in an economic environment at a time when employers across all sectors are converting formal jobs to gig at a very rapid pace.
The government often speaks of the country’s “youth demographic dividend”. However, unless it builds a sustainable gig economy by keeping the country’s youth happy, it will be empty talk. Young Indians working in the gig economy have at least schooling, a smartphone and a scooter. They don’t want to do a 10-5 job like their parents. They want a job where they have the flexibility to choose their employer, job, location and hours. They want high income and a good work-life balance. If the gig economy doesn’t give them what they want, they’ll be dissatisfied and stay away from it. And those who stay don’t give their all, eroding the employer’s brand value. Both governments and employers should take steps to prevent young people from becoming disillusioned with the gig economy.
