The Gig Economy: A Paradigm Shift in Work Culture

Nowadays, an increasing number of people are becoming fond of independent contract-based and freelance work, and this marks the departure of typical 9-to-5 jobs. Getting a task done at a designated location where one would typically spend eight hours a day no longer does justice to the ever-evolving definition of a job.

Illustration by The Geostrata

As the traditional work culture undergoes a significant transformation, the expectations of both employers and employees have substantially changed. 

Consequently, the concept of the gig economy rose to prominence. It simply refers to the workforce of people engaged in freelance and side-hustle work, which offers employees a bouquet of luxuries, such as independence and autonomy, while taking away job security and stability from them. Throngs of youth are prioritising contract-based work mainly due to the work-from-home culture propelled during the COVID-19 pandemic, mass layoffs, and the paradigm shift in work culture. 

The UK government defines the gig economy as “the exchange of labour for money between individuals or companies via digital platforms that actively facilitate matching between providers and customers, on a short-term and payment-by-task basis”.

While the definition appears to be indicative that the gig economy is primarily associated with jobs that are intrinsically temporary and limited to platform-based work, such as taxi driver services like Uber, food delivery services like Zomato or Swiggy, or booking a holiday rental, which may be partially true, it actually goes beyond such services.

Image Credits: Rightful Owner

The gig economy has profoundly influenced the formal employment sector too, which manifests as moonlighting, which is the practice of dual employment. An employee is said to be ‘moonlighting’ when they are serving the business of the same niche while being a permanent employee of another.

All these occurrences uphold the new workforce revolution that is underway globally. India, with its world’s youngest population and half-a-billion labour force, is the new uprising stakeholder in this revolution.

In 2020, India boasted 7.7 million workers engaged in the gig economy, which is expected to grow to 23.5 million workers by 2029-30.

Statistics show that at present, 47% of gig work is in medium-skilled jobs, about 22% in high-skilled, and about 31% in low skilled jobs. Furthermore, moonlighting is gaining significant momentum in India’s IT sector. 

WHAT TRIGGERED THE RISE OF SUCH PRACTICES?

The COVID-19 pandemic compelled offices to shut down and popularised the concept of working from home. It gifted workers some idle time, which many used to secure an additional source of income. This rings true especially for tech workers, as since 2020, the Indian IT sector has registered a sharp increase of 25%-30% cases of moonlighting.

Furthermore, the pandemic-infused economic turmoil led to the collapse of the job market, leaving millions of workers jobless. This led to people securing temporary work opportunities to sustain their livelihoods. Additionally, the global recession, economic slowdown, and rising inflation led to mass layoffs, which also compelled people to search for multiple income sources to compensate for the rising cost of living.

However, on the other hand, the concept of the gig economy can also be studied as a paradigm shift in the overall behaviour of human resources; the younger workforce today wants to prioritise independence and autonomy.

As employer loyalty erodes, Gen Z embraces side-hustle as a source of primary income. Data reveals that 57% of Gen Z would abandon a 9-to-5 to be a social media influencer. Such a pattern, however, is increasingly prevalent in first-world countries, where the concepts of temporary employment, multiple employment, or side-hustle are largely fueled by privileged motives. 

CONS OF THE GIG ECONOMY

The most prominent issue gig workers face today is the lack of job and social security. India’s highly volatile job market puts millions of such workers in a vulnerable and complicated spot where, in the event of economic shocks, these people will lose livelihoods with little to no savings in their hands. Plus, they are not covered under any insurance or pension schemes.

Gig workers in India are also severely underpaid due to the disequilibrium of labour demand and supply caused by the unemployment crisis the country is currently facing. Furthermore, the gig economy heavily relies on the digital ecosystem, and a lack of access to the internet or digital devices would prove a handicap to potential employees. 

WHY IMPORTANT FOR THE INDIAN ECONOMY?

The rapid expansion of the gig economy benefits employers by lowering administrative and compliance costs and gaining a pool of flexible workers. Additionally, the excess supply of labour has kept wages relatively low. This has been a substantial relief for companies in the wake of the post-pandemic economic slowdown. As for the gig workers, they enjoy enhanced flexibility, independence, work-life balance, and autonomy to work for multiple organisations and diversify their income sources.

MOONLIGHTING AND LAW

No Indian law explicitly declares moonlighting illegal. It means the law doesn’t prohibit tech workers from being employed in more than one organisation. While the Indian Factories Act 1948, the Industrial Employment (Standing Orders) Central Rules 1946, the Delhi Shops and Establishments Act, 1954, and the Bombay Shops and Establishments Act prohibit dual employment, none of these laws cover the IT sector. Hence, moonlighting cases are dealt with as per individual employment contract clauses at organisational levels.  

In 2020, Wipro fired about 300 of its employees who were caught working for a rival company taking advantage of work from home, indicating the company’s strict and conspicuous views against moonlight, an opinion shared by other business giants like Infosys and IBM.

However, on the other hand, companies like Swiggy consider moonlighting the ‘future of work’, and have allowed their employees to moonlight as long as it doesn't hamper their productivity. Such a difference of opinion indicates a rising need to bring such practices under law and make the IT sector more regularised.

The rise of the gig economy signifies the transformation the labour market has undergone in the past few years. It is a testament to people’s evolving perceptions about the traditional work culture, and while multiple factors have contributed to the concept's exponential rise, it has been profoundly influenced by people’s motivation to have more job flexibility and long-term work-life balance. Furthermore, the gig economy has enabled employees to cash in on opportunities via technology and digital resources, which is especially beneficial to the Indian youth, given India’s robust digital infrastructure. The need to regularise and legalise such practices is growing with the increasing numbers of gig workers in India in order to foster a productive workforce.

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BY SATAKUL

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