Making Of India’s Gig Economy: Redefining How Startups Hire New Talent

India’s gig sector is likely to grow to $455 Bn at a CAGR of 17% by 2024 with the potential to grow approximately 2 times the pre-pandemic estimates, according to a  report by ASSOCHAM. The demand for freelancers is increasing, and several supportive and purpose-driven platforms have emerged to aid this. 

India is undergoing a drastic shift in its work culture. The rapid digitalisation, hybrid working models, a thriving startup ecosystem, and an evolving talent landscape — all spurred by the Covid 19 pandemic, have disrupted the labour market. The workplace is witnessing a paradigm shift with the geographical boundaries of work blurring each day. The pandemic untethered work from the office and unlocked a new economy, the gig economy.

The gig economy essentially implies the employment of temporary or part-time professionals instead of conventional employees by an organisation. Although in existence for a long time, the gig economy has grown manifold over the years and attracted attention worldwide. As businesses and employees witness the benefits of contractual and freelance opportunities, the gig economy is set to become the future of work. 

What Is Behind This Shift?

Globalisation

The current interest in the gig economy has been spurred by a large extent digital technology and the use of freelancing platforms which have helped connect gig workers globally. 

Globalisation has directly impacted the workforce of today. It made it possible for companies to expand internationally, for workers to be able to travel and work worldwide and for companies to engage talent in global regions where they may not have a presence.  

Millennials And Gen Z Workers Are More Inclined Towards Freelancing

According to CMIE, around 53 Mn Indians were reported to be unemployed in 2021. The pandemic compelled the burgeoning millennial and Gen Z workforce to rethink their career paths, work schedules, and workplace preferences. 

Looking to break away from the hustle and grind of office culture, the gig economy offers the millennial workforce flexibility, competitive payouts, a variety of projects to choose from, and autonomy. Enticed by contracts with leading organisations across the globe and the chance of a healthy work-life balance, it’s no wonder it has become a leading choice for the young working populace.

Lifesaver For Businesses During Covid 19

As the pandemic hit the globe, organisations pivoted almost overnight to remote working models, resulting in delayed projects, lost clients and customers, and mounting losses. 

At a time like this, many businesses shifted to freelancers, and contractual and gig workers for various technical and non-technical projects. This framework enabled organisations to reduce operational and administrative costs. 

Mania Of Startup Culture In India

Accustomed to breaking conventions, Indian startups have been known to constantly innovate with their workforce and working models. Instead of incurring substantial fixed costs by hiring full-time employees, startups are choosing to leverage the expertise offered by freelance and gig workers at reduced costs. Consequently, startups with limited funding and resources are able to outsource projects to domain experts and bolster their technology platforms. 

Technology — A Key Enabler

Contrary to the popular belief that technology has disrupted businesses and jobs, tech has instead created a slew of new jobs and optimised several business processes. Consequently, companies are experiencing a rampant demand for tech talent. With the pandemic stirring demand for rapid digitalisation across industries, many ventures prefer contracting tech projects to freelance and gig workers. 

Rise Of Online Freelancing Platforms

In the past few years, the number of online freelancing platforms and marketplaces has multiplied worldwide. Indian freelancing platforms have grown from just 80 in 2009 to 330 in 2021.  These platforms are creating an ecosystem where freelancers and gig workers can connect with large and small companies. 

Such online platforms are ushering in the future of work where professional relationships are symbiotic and allow both companies and workers equal freedom and flexibility. The evolving landscape of work is changing business models and empowering the workforce towards self-employment, catalysing a larger gig economy.  

The Road Ahead

Given the unorganised nature, it’s hard to estimate just how many Indians make a living from the gig economy. Though according to a Boston Consulting Group study, more than 8 Mn Indians are gig workers, a number that is expected to grow to 24 Mn by 2023-24 and to 90 Mn before the end of the decade. 

With roaring technological transformations, the constantly evolving nature of work and the global pandemic, the gig economy is being touted as the new working-class norm. Though, it would be quite amiss to not mention the challenges that gig workers face, especially in India. 

Reports of mistreatment, low salaries and bureaucratic delays in policy implementation show a different picture. Even though most workers opt for gig work for the flexibility, the reality is that they are stuck in a full-time job without the protections that come with it. 

With an influx of gig workers and freelancers expected to enter the gig economy, the only way forward is to fine-tune labour laws and social security rules for gig workers, constant upskilling opportunities and technological empowerment of the gig workers.