A look at the gig economy in 2022-23

In a first of its kind report released in 2022, entitled ‘India’s Booming Gig and Platform Economy’ the country’s top planning body NITI Aayog made some remarkable revelations and forecasts. It projected the total employment potential of the gig economy to be 23.5 million (4.1% of the total workforce) by the year 2029-30. This will be a massive leap of 200 percent from the 7.7 million workers engaged in the sector at present.

A gig economy typically doesn’t involve the traditional employee-employer arrangement. The professionals are instead hired from task to task or project to project, and paid on a pro rata basis. This includes software engineers, website developers, freelance content writers, project-specific consultants and delivery agents.

Due to its characteristically low entry barriers, the gig economy offers massive potential for job creation in the country. Besides, the flexible nature of this sector brings in plenty of occupational mobility to the economy and covers risks for those seeking a switch in careers or just joining the industry after completing their education.

The post-pandemic shift in working styles to work-from-home and hybrid work, has given a huge fillip to the country’s gig economy. The marketing and sales jobs for instance saw an almost triple digit growth in appointments. The great news is that while the bigger cities have expectedly bagged the largest share of the surge, the tier-1 and tier-2 cities haven’t been left far behind either. The internet and mobile telephony that has been penetrating deeper into the country’s interiors acts as the foundational infrastructure for most of the gigs across industries like fintech, health-tech, e-commerce and Q-commerce. Technology has thus created a paradigm shift and turned the tables on the country’s geography, which would have been unimaginable in the conventional economy.

All of this is happening at a time when the country and its government is increasingly focusing on skill development and vocational training of its workforce. The country’s education system is realigning its goals to place much greater emphasis on practical abilities rather than theoretical learning. This will further supercharge the just-out-of-college youth to dominate the gig economy. Already, the millennial and GenZs comprise a whopping 48% of the gig workforce, followed by the age groups 26-40 years (32%) and 41-60 years (20%). Besides, out of the total gig workforce, an encouraging 28% are women.

Taking a global view of the gig economy and juxtaposing it to the Indian experience can give a better perspective and a sense of direction about this new and rising economic phenomenon. The number of gig workers globally is expected to rise from 43 million in 2018 to 78 million in 2023, and the global freelancing market is expected to grow at a healthy CAGR of 15% through 2026. At present, 50% of the global freelancers are doing skilled work like programming, counselling, IT services and marketing. These trends will be quite insightful for emerging nations like India, Indonesia and Brazil, whose governments must plan ahead to shape their gig economies and prioritize sectors for dedicating resources.

India’s gig economy however has a number of formidable challenges and concerns that may not be shared by developed global economies like the US. Most of these challenges can be redressed when industry bodies, government institutions and organized professionals come to the table, and ensure the fruits of the growing gig economy are shared equitably among all stakeholders.