Rising Inflation, Fuel Costs Eat Into The Earnings Of Food Delivery Executives

According to a study conducted by the National Council of Applied Economic Research (NCAER) on the Indian gig worker ecosystem, the average real monthly income of food delivery executives in the country saw a drastic decline between 2019 and 2022. 

As per the findings, the average monthly real income of long-shift workers, working 11 hours a day, tanked to INR 11,963 at the end of May 2022, compared to INR 13,470.8 in 2019. 

Real monthly income accounts for inflation rates while nominal income does not adjust for the same. 

This fall was largely attributable to rising fuel costs and growing inflation, which emerged as a major factor for the high-attrition rate in the gig economy. 

“…it has become increasingly difficult to achieve daily/weekly targets over time… due to increased traffic and greater competition. On the other hand, fuel costs had (have) gone up… so workers have relatively little left,” the study noted.

The report also highlighted that the ability of long-shift food delivery workers to meet current household expenditures went down during the period under review. While noting that the surveyed gig workers were breaking even in 2019 and 2020, the report said that delivery executives found it difficult to eke out monthly expenditures from their income from delivery platforms due to rising fuel costs and inflation in the subsequent years. 

Another major takeaway of the report was that an Indian long-shift food delivery executive, working 11 hours a day, earned an average of $1.1 (INR 90.96) per hour. In contrast, a food delivery worker currently earns an average of $20.63 per hour in the US, according to another report. 

The findings were part of a telephonic survey conducted by the NCAER of 924 food delivery executives belonging to one particular food company spanning 28 Indian cities. The survey was carried out between April and May 2022 and the results were tabulated in a report — ‘Socio-economic Impact Assessment of Food Delivery Platform Workers’.

What stood out glaringly in the report was the mismatch between the skills required for the job and the qualifications of the workers. A third of the surveyed workers were found to have a graduation degree, while more than 12% of the respondents had a technical or a vocational degree (or diploma).

The study also highlighted the overarching dependence of workers on food delivery platforms. Consequently, nearly half (43.7% to be precise) of the surveyed gig workers were sole bread earners while another 20.6% were the primary breadwinners of their respective families. 

A Tiring Job, Nonetheless

Of the total respondents, gig workers undertook an average of 15.2 deliveries a day. Of this, 18.4 deliveries were done by long-shift workers while 10.3 deliveries were done by executives working on weekends or 5 hours a day. 

As per the report, the average base rate per delivery for active long-shift workers stood at INR 25.1, varying from city to city. Further, long-shift delivery executive made an average of INR 461.8 per day without incentives.

Besides, these surveyed delivery workers travelled an average of 95 km a day while making deliveries. For active long-shift workers, the number stood at 118 km, while the metric hovered around the 59 km mark for short-shift workers.

The study also highlighted the point that the Indian gig platforms have been able to formalise a large section of gig workers and bring them under the ambit of the social security net. It also noted that platform work largely generated local jobs with 70% of the surveyed workers operating out of their hometowns. 

Meanwhile, the NCAER, in its report, also urged the government to adopt a balanced approach while formulating policies to manage the flexibility of the gig ecosystem, along with improving the working conditions of workers.

“A balanced approach needs to be worked out so that the nature of the work is kept intact while simultaneously improving the condition of the workers. The answer lies in improving the social security of the workers and recognising their skills learned while working at the platform, which helps them to move on successfully,” the report added. 

The report also termed the government as the ‘best medium’ to provide social welfare support to gig workers, adding that consumer internet platforms may divert additional revenue to the authorities to finance social security initiatives in a centralised fashion. 

As India’s digital economy grows by leaps and bounds, it has also brought the focus on the condition of gig workers in the country, who operate outside the ambit of full-time employment offered by these platforms. These delivery executives are not offered similar rights as other regular employees and, as such, may or may not be able to avail social security benefits.

As per a NITI Aayog report, India was home to more than 7.7 Mn gig workers in FY21, a number that it projected to soar to 23.5 Mn by 2029-30. The NITI Aayog report then stated that gig workers would likely form 4.1% of the total livelihood in India by 2029-30. As such, the focus has turned to these platforms to offer equitable benefits to these workers. 

Questions have been raised, especially at a time when major startups such as Ola, Uber, and Dunzo scored a duck on Fairwork India Ratings 2022, on the working conditions of gig workers in India. Even growing incidents of gig workers meeting with accidents while on duty have also raised concerns about the need for the extension of social welfare benefits to the country’s  gig workers. 

With the country’s labour laws failing to do much for these workers, it remains to be seen how authorities develop a full-fledged regulatory framework to put the onus on the employers to enhance their standard of living. 

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