‘India’s Booming Gig and Platform Economy’: Niti Aayog

Why in the news?

Recently, NITI Aayog released its report, ‘India’s Booming Gig and Platform Economy’.

Key Points:

• It pitched for fiscal incentives to draw more women into the gig economy.
• Fiscal incentives like tax breaks or startup grants for companies with about one-third of their workforce as women and people with disabilities (PwDs).

What is gig economy?

• The economy based on flexible, temporary, or freelance jobs, is called gig economy. 
• It may involve connecting with clients or customers through an online platform.
• The gig economy can benefit workers, businesses, and consumers by making work more adaptable to the needs of the moment and the demand for flexible lifestyles.
• It can have downsides due to the erosion of traditional economic relationships between workers, businesses, and clients.

Who are gig workers?

• Gig workers are typically hired by companies on a contractual basis and are not considered their employees. 
  • As a result, they do not receive some of the benefits that an on roll employee of the company get.
  • Gig workers can be broadly classified into platform and non-platform workers. 
    • Platform workers are those whose work is based on online software apps or digital platforms. 
      • Example: those whose work is based on online software apps or digital platforms such as food aggregator platforms Zomato, Swiggy, Ola, and others.
    • Non-platform gig workers are generally casual wage workers, working part-time or full-time.

Workforce engaged in the gig economy:

• More than 7.5 million workers were engaged in the gig economy in 2020-21. 
• This could grow to 23.5 million workers in the next eight years, making up for 4.1 per cent of total livelihood in India.
• 47 per cent of the gig work is in medium-skilled jobs, 
• 22 per cent in high skilled, and 
• 31 per cent in low skilled jobs. 

What are the challenges of the gig economy:

• Lack of job security
• Irregularity of wages
• Uncertain employment status for workers etc. 

What are the Recommendations?

• Gender Sensitisation: To promote the rights of women and persons with disabilities, the report suggests that companies carry out gender sensitisation and accessibility awareness programmes.
• Social Security Measures: It recommended that firms adopt policies that offer old age or retirement plans and benefits and other insurance covers to gig workers.
• Access to Finance: Access to institutional credit could be enhanced through financial products specifically designed for platform workers and those interested in set up their own platforms.