As the norm of the conventional 9-to-5 work culture loses its charm, there is one more trend in parallel on the rise- the gig economy. Gig workers are slowly changing the face of the Indian workforce, with over 15 million skilled professionals fueling the ever-so-increasing demand for contract-based jobs or the freelance industry in India.
However, the gig industry is besotted with its own challenges. Hiring and engaging the temporary workforce is the biggest challenge organizations face today. In an exclusive interaction with People Matters, Pravin Agarwala, Co-founder and CEO BetterPlace Safety Solutions, a blue-collar workforce focused platform, talks about the rise of the gig economy in India and its future potential.
The rise of the gig economy is a global phenomenon. How has its progress been in India and its current state in India?
The gig economy is not a new phenomenon in India, it has been for ages. In the US and Europe, it had started with software technology where people worked on a contractual basis. Fortunately, in the two markets, it was more process-driven as the market was more mature. In India, you have had people working part-time since ages but the challenge has been that it was not organized, and hence not recognized. However now, with the emergence of Ola, Uber, Swiggy and the likes, the perception around the gig economy has changed-it’s no more once in a year or a part-time sort of job. It has morphed into a full-time opportunity and people today have now better access to it.
The second thing that has changed is that even traditional companies which earlier went for full-time employment, are now opting for it for shorter tasks given that now it is more organized and process-driven. Of course, the shift is faster in the newer age companies.
What is the one big difference you have seen in the gig economy of today-then vs now?
Besides being more organized, it is more transparent now. But most importantly, the big change is that people are looking at it as a potential full-time opportunity. One big reason for that is technology has made the opportunity more accessible. Hence the acceptance level for the gig economy has gone up, which is a huge change.
Also, people have also started accepting that if a job is done well, it does not matter if the same person is coming every day to do it or not. Take instance for retail outlets or outlets like McDonald’s who bring in gig workers for the weekend to cater to the huge demand and the next weekend, they might have a different set of gig workers coming to work.
Also, companies are always looking at how they can minimize costs so that efficiency goes up and gig economy offers that choice. Similarly, aspiration levels have also gone up and people want to earn more, hence they can now leverage the gig economy for the same.
What are some of the challenges you have seen when it comes to hiring gig workers?
Hiring gig workers is a perennial problem unfortunately and if you look at the attrition, it may be as high as 300% annualized in some industries. The biggest challenge is that the supply pool is still very limited as compared to the growing demand for gig workers, especially in metro cities. Bringing in new resources in the economy is a challenge.
The other challenge that ensues because of the limited supply pool, companies end up hiring whoever walks in, affecting the quality of the hires be it in terms of communication or trust or delivery. This further feeds into creating attrition.
The third challenge is that as opportunities are growing, companies have to compete with other companies for talent, further fuelling the talent war.
What do you think are some core points organizations should focus on while engaging gig workers?
The one thing that organizations miss out on while engaging gig workers is the aspect of brand building and loyalty. Gig workers relate more to the task than any particular brand, which fuels attrition.
The second reason is that people are migratory in nature. Hence it is difficult to bring down attrition. However, in order to bring more loyalty, organizations need to move beyond transactions and see if they are helping their families to become better. Health is a big issue-so are we providing them requisite health incentives? Similarly, finance is a big issue-so is the company supportive of providing them credit opportunities when required? These measures will increase engagement as well as brand loyalty. Similarly, transparency around payments is another big measure that affects engagement.
Organizations normally fail to do enough when it comes to skilling gig workers. How do you think organizations should approach skilling to make a real difference to gig workers?
While companies do invest a lot in skilling the white-collar workforce, unfortunately, when it comes to the gig workers, skilling is not a priority for organizations. While people are trained to do the job, but measures to develop the person holistically and prepare him for a higher job are lacking at the moment. That investment is very limited and the need of the hour is for the ecosystem to invest in people as that will ultimately upskill the ecosystem itself.
Secondly, the inherent inertia of people to upskill themselves is also a challenge. There has to be a model which incentivizes skilling in order to enable upward movement of gig workers.
What do you think are the trends as far as the future of the gig economy is concerned?
Currently, the share of the gig economy in the blue-collar workforce is 2-3% which is expected to grow to 15-20% in the next five years. Secondly, the attrition levels over time will also come down over time as people will start seeing more benefits in staying with one company.
Also, a lot of processes are still missing in the gig economy, which over a period of time, will start kicking in. That will streamline it further. With mobile penetration, people will have more access to local opportunities, which will bring more and more people into this economy. Finally, I believe the aspirations of employees will drive the transformation in the gig economy alone more than from the employers’ side.