Reflections from bottom corner: Gig Economy: A new shrill in the Employment market

https://yourstory.com/2018/02/gig-economy-labour-welfare/

1.What are your initial thoughts about gig-economy or freelance movement culture? Is India among the world’s leading gig economies?

Gig economy or peer to peer economy or shared economy or collaborative economy indicates increasing trend of

- preferences for work hour flexibility,

-freedom of choice of work,

-use of technology, Apps, mobile and internet services

-micro entrepreneurship due to unleashed risk taking ability, knowledge base, institutional support like start up, stand up India, self help group like micro credit led venture

-disruption in existing employee- employer relationship as during command height of state led economy as in India pre 1990s

- search for skilled, efficient workers which are scarce, so few are hired to serve at multiple places

- surge of knowledge based economy as service sector ruling the roost all over world

- automation in industry laying off retrenchment, so individual searching for job at many places

- nuclearization of family structure, break of joint family causing need of domestic workers who in turn working at many places

- weakening of labour unions( idea of communism n socialism getting dent from onslaught of market fundamentalism)

Gig economy corresponds to culture of contracting out as in outsourcing of work, project based employment, and public private partnership etc- all such development is on assumption of such customized hiring of workers is more efficiency/profit//quality oriented. The very culture of consumerism and market economy, profit seeking by hook and crook has led to informalization of work culture at the cost of long term organizational culture. New norm is fragmented loyalty of employees towards multiple enterprises at a time or with none at the same time. It has trade off in terms of casual work culture, no social security support, no sense of stakeholdership, violation of labor laws, loss of bargaining power of workers, no emphasis on skill/long term career plan.

India is one of the largest emerging economies where there is simultaneous display of formal as well informal sectors. The very sheer demographic size trivializes the effort of formalization effort of employment. The need of 1million job each month is unmet by paltry growth of formal employment at rate of 1-2 lakh each month. So, huge workforce is getting casual, informal work and is getting involved in freelancing and that in turn gigging the economy.

Besides , the automation, technology inclusion, penetration of internet and mobile technology, entrepreneurial forces unleashed by incubating centers, microcredit support, government endeavors as in start up, MUDRA schemes, skill India, Digital India etc. are fuelling the Indian Gig economy which potentially seems to blow up to $350 bn plus economy b 2025.

The philosophical tone of Gig economy is to conform the idea of capitalism, individualism, liberalism, meritocracy, marketism, so for developing countries like India this trend may be in infancy in comparison to EU and USA and other developed economies where 30-40% of work force are involved in Gig economy. Nevertheless, the very volume of large workable population does indicate such trend.

2. What’s rate at which gig economy/ informalisation of work is growing in India?

3.About 24% of the global freelance workforce comes from India. What are the reasons it is catching up so fast and why is it so popular among the employers?

Reasons for catching up—

1. . Flexible work hours in comparison to mechanistic 9-5 pm , so a sense of freedom, disposable time to get involved in recreation socialization,

2. Burgeoning aspiring youth populace fantasized by the idea of entrepreneurship,

3. Technology getting in every hand spurring the growth trajectory,

4. Women folks so far suppressed by social sanction finding such flexibility a way of asserting individuality,

5. A value to merit being recognized, good earning from multiple sources with less obligation as in formal employee-employer relations,

6. Informalization of work due to unmet rate of employment,

7. Booming of service sector as in tourism, real estate, transportation, insurance, hospitality etc..

8. Foreign intervention due to globalization, global players like uber, Arnbnb coming up to tap Indian market,

9. Government is too soft to ensure ease of doing business as in its labour law to give power of hire and fire policy (raising the threshold of number of employee to let law be applied)

Becoming popular among Employers---

1 .Employers find it as an alibi for mandated labor laws, wage and social security law, factor laws etc. Which were undue policing by government.

2. No need to invest on skilling employees,

3. The increased efficiency, qualitative outcome from skilled workforce on competitive basis increased the credibility of products and enterprise, so more profit, good will.

4. You think the gig economy is recklessly eroding the social welfare objectives of various labour legislations?

Gig economy encourages an individual based work culture; it doesn’t binds an individual to any one enterprise, so the obligation of the enterprise to look after the employee gets trivialized. It is not bound by labour laws as in factory act to ensure good working condition, or social security act as maternity benefit to women in terms of paid leave etc, or gratuity act to pay a lump sum amount for working with enterprise for long or provident fund and miscellaneous act to ensure secured future or a call for pension to support lifelong not only for the employee but for his/her dependents.

For India like country who has obligation as per “directive policy of state policy”(DPSPs) must meet the mandates of article 41, 42,43,46 etc. which is socialistic in nature not compatible with Gig like culture which leaves an individual on his/her own fate.

As Gig economy disrupts the formal employer-employee relationships, so the erosion of the idea of social welfare. No enterprise will feel genuine obligation for wandering loyalty as an employee out of better deal work at many palaces as part time.

However, there is need to remap the trend and legislate the need of social security for a developing countries like India where most of the workers don’t have negotiating power vis -a vis wage and better working condition.

5. What do you have to say about the size, scale and loopholes associated with the gig economy, particularly against the background of unionization?

Unionization has been a natural sociopolitical development out of labor led economy. The very recognition of ILO as a prominent international organization working for better deal of workers signifies unionization or unity of labors. However, the growth of “individual pursuit” in labor market has broken the unity of workers, so the collective loss in terms of getting due pie from profit share, better negotiating power, and a “say” in management.

Gig Economy discourages institutionalization of work culture and hence a randomness in overall work dynamics. So, the seeming freedom, flexibility, meritocratic culture like attributes out of Gig Economy ma not suit to each socioeconomic setup.

6.The freelance movement is also hampering the livelihoods of many labour communities who were heavily dependent on permanent nature of jobs. E.g., Railway caterers effected by the digitization of food orders, auto drivers losing out becoz of Ola & Uber etc… In this context, how is it detrimental to the labour class?

It is well known “technogical intervention” is double edge sword. In service sector it is removing intermediaries and as sense of “customer sovereignty” is being felt. But the backlash of automation or technological interface can be seen on employment of those who were doing those jobs.

Labours have always been tools to meet the end of profit and customer satisfaction. There has not been any emphasis on empowerment of means as here on labours rather there have been systematic efforts to resize, retrench, prune, lean the work force to decrease the input cost. So, the the ideas of Gig Economy is definitely detrimental to labour class when it is- breaking the permanency of employee-employer relations, abolishing the social security system, hanging a sword of retrenchment and no system of career based employment.

Nevertheless, It gives opportunity to labour class to come out of comfort zone, reorient itself, skill for higher pay up. Here, in context of UBER it cant be denied the idea of technological intervention is good in terms of finding customer at tap of an App. Yes, the role of UBER in terms of fees it charges, employer- employee relationship etc. can be better determined to sustain the business model for win –win situation for each. The so called each driver is a partner with UBER is a camouflage undermining the sanctity of employer- employee relationship and hence violation of various laws concerning it.

7.Which are the sectors where informalisation of jobs is rampant? You think our government schemes also promote contractualisation of work which don’t aim at upliftment of our labour class?

Informalization of jobs is rampant in-

1. Agriculture sector as there is no established set up to make agriculture as industry, so no labor law upholds here,

2. Construction sector- the increasing need of infrastructure to meet economy, housing to house population, establishments to sustain the growth of the country etc. have attracted a lot of workers without proper regulation or formalization because of time bound construction activity and no apt law to deal with this loophole in labor ecology.

3. Tourism sector

4. Hospitality and hotel

5. Domestic workers

6. Illegal Mining

7. Kiln Industry

8. Cottage Industry

9. In general service sectors like online tutoring, counseling, and individual start up etc.

10. Media

Government in new ethos of New Public Management is too adopting market led work culture to make it competitive and cutting the cost. The culture of contracting out, PPP Model, Outsourcing, project based job creation, Ad hoc employment etc. which don’t aim to uplift labour class. As said earlier labour class is means which is only refined to cut the cost rather taken as obligation as in past the public sector culture had emphasis to create employment in hinterland. The external forces of globalization, global treaty as in WTO etc are influencing government labour policy. The Right to work as in NAREGA like schemes avail only 100 days work that also unskilled one work as only stop gap arrangement and spurs the culture of informalization.

Nevertheless, new labour laws, Apprenticeship act, draft on social security code etc. collectively emphasize on formalization of work culture.

8.Freelance jobs are often marketed as being flexible because they allow for better work-life balance, especially in the IT industry which depends on major outsourcing of work. However, what are the long-term implications of this trend?

Long Terms implications are-

1. Non emphasis on skill enhancement of work force

2. A threat to intellectual property right or business secrets like thing which can be used to undermine competitiveness when a worker is working for multiple enterprises

3. Social security system in ad hoc manner a burden on state exchequer at later stage

4. Growth of the economy would be haphazard, concentration of wealth in few hand

5. It will create bubble as such chaos of ad hoc and random work culture will not be predictable

6. Big enterprises will net in all talents at high pay roll so a dent to democratic dynamics in market

9. Freelancing as an employment option has not yet penetrated the rural landscape in India. Are there chances this trend can soon expand?

The idea of freelancing is yet to percolate down to primarily agriculture based rural economy. Still the ethos of individualism, breakage of joint family culture, end of feudalism etc. are yet to take deep root in hinterland, so the freelancing or assertion of individuality is a far thing.

Nevertheless, the increasing penetration of mobile/internet/digital literacy, agriculture and allied sectors taking a shape with government as well as corporate intervention, service sector getting a prominence with rural tourism etc. can potentially pave the way for freelancing as an employment when aspiring youth are restless to be integrated with globalised world even in rural counterpart.

The very paradoxical situation of India’s growth profile doesn’t easily predict the chances of it getting expanded due to multiple supporting and opposing forces act at the same time. Various schemes like start up, stand up India, skill India, microcredit support to SHGs, faster technological penetration do indicate so.

10.What does this trend mean to the limping Indian Economy in general? Where are we headed next on the employment map with this fast emerging gig trend?

1. An encouraged , talented youth will have plethora of opportunity to cut a niche in labour market but this deal will not be available to big chunk of labour, so a demographic backlash would be felt impacting Indian economy in terms of unutilized labour pool available at low cost, so a dent to competitiveness.

2. Indian economy despite being connected to developed world cannt affords to overlook the societal reality where state led compassionate care is a ever felt need as the very legislation of Right to work exemplifies it.

3. Gig Economy flourishes in a well developed set up where people are capable to look after themselves for most of the basic needs. Such trend in developed world can be seen but for Indian economy such trend will create a social chaos.

4. The outgrown service sector contributing upto 60 % of GDP with only around 20-25% workforce engagement enhance chance of gigging when IT sector is in its prominence here.

5. Even hinterland too can see the gigginess of economy when facilitating development like agri based service sector will take the shape.

6. Indian economy will miss the bus of manufacturing sector development when neither automation will develop well nor labor based industry will take shape depending highly on service sector and its gigginess.