Platform economy is fast picking up in India employing lakhs of people and promises to give livelihood to many more in the years to come, thereby changing the face of the traditional employer-employee arrangement. Going by what Niti Aayog says in its report titled ‘India’s Booming Gig and Platform Economy,’- the gig economy gives employment to more than 77 lakh people in India, which can broadly be classified into platform and non-platform based workers. Gig economy being a larger concept, platform comes within its ambit, however it becomes much more substantial with its immense prospects being in the process. With many Digital India initiatives, low cost internet, increasing penetration of smartphones with good specifications and associated technologies, India is fast becoming the new frontier of the platform economy. The world’s youngest population equipped with the required technical knowhow and language skills and the fast rising urbanisation add to the momentum of this change.
Delving deeper into the platform economy, the NITI Aayog reports provides insights into the possibilities of the sector, as well as a road map for further research and analysis. The report estimates that 77 lakh workers were engaged in the gig economy in 2020-21 with construction, manufacturing, retail, transportation and logistics sectors having the highest potential to produce ‘gigable’ jobs in the future for India. Currently more than 75% of the companies have less than 10% of its workforce in gig mode, but this proportion is bound to rise fast with a large number of companies including MNCs fast turning to flexible hiring options.
The scope of the growth of the platform economy is huge as large number of consumers are moving towards digital platforms/apps for their day to day needs and self-employed individuals engaged in the business of selling regional, rural and other things like cuisine, street food, goods etc. also want to be parts of the larger process, so that they can sell their produce to wider markets in towns and cities. However as suggested by the Niti Aayog, this whole process needs some arrangement on the lines of ‘Startup India Initiative’ to accelerate creation of digital platforms through hand holding, funding support, incentives and skill development with accelerating access to finance through products designed for platform workers and linking street food vendors with gig platforms. Platform economy does need unsecured loans especially for the first-time borrowers participating in the process. FinTech and platform businesses may be leveraged to provide cash flow-based loans to such entrepreneurs as against collateral-based loans, thereby catering to the needs of those new to credit. Platform-led models of skilling and job creation also need to be promoted for this sector.
The immense prospects of the platform economy can be gauged from the facts put forward by the Niti Aayog. The gig workforce is expected to expand to 2.35 crore workers by 2029-30. At present, about 47% of the gig work is in medium-skilled jobs, about 22% in high skilled and about 31% in low-skilled jobs. Trends show the concentration of workers in medium skills is gradually declining and that of the low skilled and high skilled is increasing. It may be expected that while the domination of medium skills would continue till 2030, gig work with other skills will emerge.
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