Rise of the ‘Gig Economy’ and it’s Health Toll on Workers

While there is no standard definition for the term “gig economy” what is commonly understood is that “it is a platform where providers cater to customer needs using the digital platform within a short time frame and in turn the customer pays for the services obtained using the same platform.”[1] The Code on Social Security, 2020 defines a gig worker as a person, who performs work or participates in a work arrangement and earns from such activities outside of the traditional employer-employee relationship.[2] The term “gig” itself generally implies freelancing, part time work or on-demand staffing services.[3] This unique economic model has experienced a sudden boom in the last decade particularly so in the developing countries where cheap labor is easily outsourced by large companies to smaller players in the informal market sector.

In India, according to the Niti Ayog the gig and platform workers were employing close to 7.7 million workers in 2024 and these numbers are expected to exponentially rise to around 24 million workers by 2030.[4] The World Economic Forum reported that last year the gig economy had a market size of $556.7 billion and by 2032 this will triple to almost $1847 billion.[1] In India, the gig economy is projected to contribute around 2.5% to the GDP by 2030.[3] All these numbers indicate that this novel approach and non-traditional work arrangement is here to stay and would be only growing in the years to come.

Why is the gig economy a lucrative option in the Indian context? The country boasts of a large workforce in the 18–25 years age group who are relatively better educated, technologically savvy and who favor flexible working arrangements. The “Gen Z” workers do not believe in the traditional rigors of the 9–5 job and gravitate more towards establishing work-life balance, while selectively choosing their own schedules and projects to work upon. Thus, we are seeing more and more of youngsters joining the gig model as freelancers or entrepreneurs especially in sectors like transportation, delivery industry, e-commerce sector and home services. The Indian government is also promoting these platforms by various initiatives like the Digital India initiative, Startup India, and Skill India programs.[3]

While at the outset everything appears excellent and advantageous there is a dark side to the whole “gig economy” that is now slowly unravelling. The problems faced by the informal sector of workers extend here as well. Issues of job insecurity, unstable income, exploitation, lack of legal protection and social security are a few pertinent issues marring this industry. The promise of freedom and flexibility that this sector advertises are in fact mere illusions. Many workers are trapped in the cycle of exploitation and have become dependent upon the “algorithm” to obtain even their basic wages. Unlike in the informal sector there is no middleman or manager, but rather an elusive algorithm that dictates how much work one receives, how much one is paid, nature of incentives and bonuses as well as promise of future work.

The system heavily depends upon customer ratings and satisfaction. Feedback from customers is usually welcome and can assure of the quality of services rendered. However, it can also place the worker in a very vulnerable position. One “poor” rating in the app can reduce the income opportunities of the workers and even lead to instant termination. This makes the system dangerous both for the workers and the customers. The workers are forced to work extra hours to reach their daily targets running frantically against time while the customers are placed in unsafe situations of fear and backlash from the workers in case their ratings are “unfavorable.” What has become painfully obvious with this model is that the worker is often penalized for issues and concerns that can be out of his control such as strict company policies or something as common as “traffic delays” or even irate customers. Human labor is sold as a cheap commodity and there is currently no legal protection or lobby, which will speak up for their cause. Interestingly mis-classifying certain workers like those in the cleaning industry, couriers, transport industry as well as food delivery industry as independent contractors restricts their access to basic employment guarantees such as access to health insurance, minimum leaves and paid sick leaves as well as ‘minimum wages’.

The occupational health problems faced by “gig workers” depends upon the nature of work performed. Gig and platform workers are exposed to a range of health hazards broadly classified into- physical, chemical, ergonomical, psychosocial and those related to violence.[5,6] While a driver is at an increased risk of experiencing road traffic accidents, noise induced hearing issues and exposure to dust and fumes on the road.[7] Presenteeism[8] and dangerous driving behaviors can also be noted among them. Cleaning service workers and those offering care-giving services may have concerns regarding their safety and wellbeing. Psychological effects are also likely to occur as the worker is under constant stress of “performance-based pay.” Studies have shown poor sleep quality, headaches, mental burnout, stomach issues and back pain in these workers.[1,9] Symptoms related to loneliness, depression[9,10] and anxiety are also common. Older gig workers also must contend with age-related health issues such as musculoskeletal disorders and rise in non-communicable diseases such as hypertension, diabetes, and heart diseases.

Legal protection for gig workers- Contrary to common expectations India does not have any dedicated law or policy on gig workers. However, certain laws like the Code on Wages (2019) and Code on Social Security (2020) do mention about gig workers and have established provisions for uniform minimum wages and instituted establishment of social security measures such as provident fund, health and maternity benefits, life insurance, disability insurance and skill upgradation for the workers. The e-SHRAM PORTAL introduced by the government in 2021 aimed to serve as a national database for all informal workers including gig workers. If successful they can facilitate seamless delivery of social security schemes for the workers.[11]

In this issue of the journal, two articles focus on the health issues faced by gig workers. A Brazilian paper[12] looks at sleep duration and energy expenditure among motorcycle taxi drivers. The study by Samal et al. attempts to identify the psychosocial issues faced by gig workers.[13] With the predicted and potential growth in the gig economy more studies in unique settings and perhaps multicentric studies across the country are called for—if anything to call to attention the occupational health issues faced by these employees, if not to influence occupational health practice and policy in this sector.

Individual states such as Rajasthan (Rajasthan platform-based gig workers [Registration and Welfare Act], 2023)[14] and Karnataka (Karnataka platform-based gig workers [Social security and Welfare bill], 2024)[15] have introduced state led initiatives to protect the legal rights of the gig workers. Karnataka has also introduced the “Gig Workers Insurance Scheme” under this bill which will provide health, life, and disability insurance coverage to gig workers who are not under the gambit of Employee State Insurance or paying Employee Provident Fund.

While these measures by the government are truly commendable there is still a lot left to be done. The onus lies not just with the government but also the large corporations which reap benefits from the gig economy. Apart from legal protection the need of the hour is a clear career trajectory for these workers. The web-based platforms themselves can develop models on up-skilling and create avenues for vertical mobility within the company. Formalization of gig work and regularization of the pay structure can truly transform this sector and bring about inclusivity and sustainable growth in the future.