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New tech, old worries in gig economy

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The Economic Times
22nd August, 2019 12:43 IST

He may not know the phrase, but the “gig economy” is not a new idea for 33-year-old Syed Javed Moinuddin. He’s hustled and worked at odd jobs all his life. He dropped out of school in class 4, after his father died, and started supporting his mother, from helping at a bakery, to plumbing, to assisting a mason, being a cleaner on a commercial truck and, finally, driving vehicles for a travel and tourism firm in Hyderabad.

Four years ago, he started driving a friend’s car for Uber and Ola. Since last year, he has been driving a leased Ola cab, paying a daily Rs 1,035 to the company. Then, Ola began charging Rs 4 per km for anything over the daily limit of 200 km. “Now, I work at least 15 hours, and after paying the company, fuel and meals, I take home around Rs 500 a day. How does one eat and educate one’s children in this situation?”

These are the talked-up new jobs of the platform economy, where technology companies link those who need services with those who need work. In the West, this app economy has been blamed for destroying stable industries, for turning workers into freelancers and labour transactions into one-night stands, ending the era of workplace benefits and unions. It has also been celebrated as the flexible future of work, where workers will increasingly be independent contractors rather than employees.

But if you look away from the technology — which is just a medium — the world of work hasn’t changed much. “The gig economy is just another way of saying casual labour. In the West, where they have been used to regular jobs, it means something. In India though, formal work is only for a few and 35% of the workforce has always been in casual labour,” says economist Ajit Ghose.

While platform-based work is very visible in our cities, where you can use an app to find a mechanic or a yoga instructor, or get someone to deliver your food, there are no overall jobs numbers so far. “It’s hard enough to get a measure of the informal economy. There are no reliable numbers for platform-based jobs, even in the US,” says Vidhya Soundararajan, professor at IIM-Bangalore. The US Bureau of Labour Statistics recently said that only 10% of the workforce was in non-traditional, alternative arrangements, down a little from 11% in 2005.

In India, when confronted with dismal employment data, Niti Aayog officials claimed that Uber and Ola alone created over two million jobs that did not show up in the data (an empty claim, since household surveys capture all such jobs). In March, a platform called BetterPlace pegged the number in India at 1.4 million, totting up Zomato, Ola, Uber, and so on. “In a labour force of nearly 500 million, several thousand jobs, or even one or two million, are not statistically significant yet,” Ghose points out. The entire “personal services” boom, he says, is a function of inequality — as the consumption of the more affluent segment of the population grows, so does the demand for these jobs that employ another class of people.

Take the company Urban Clap — one of the most visible platforms in Indian cities — it wants to be the Amazon or Alibaba for services. Urban Clap aims to create a million jobs by 2024, and right now they have about 25,000 professionals across India, in areas like beauty and wellness, home repair and maintenance. “I used to earn Rs 15,000 working at a salon, but now I can make up to Rs 60,000-70,000 a month, and take home around Rs 45,000 after paying for the commission, products, etc” says Sana Siddiqui. Mother of a 7-year-old, she also values the flexibility of the work as it lets her choose the rhythm of her own day.

In the beauty industry, the middlemen take the bulk of the money without adding value, says Himanshu Arora, vice-president at Urban Clap. “A beautician may do Rs 1 or Rs 1.5 lakh worth of work, but most of it goes to the salon as maintenance or profits. At Urban Clap, we flip the equation, we take 20% and the rest goes to the professional,” he says.

While Urban Clap started out as a pure aggregator, connecting customers and professionals, it has now realised the value of consistency, and is moving towards a more stable relationship with workers. It trains professionals and standardises operations with its own beauty products in one-use sachets. It also encourages worker loyalty with insurance schemes, says Arora.

At a beautician training session, a class of 20 women is being schooled in voice modulation and politeness, on how to pitch products, how to deal with sticky situations like if they drop hot wax on a client. “If there’s a conflict with the client, or if things are getting difficult, then what do you do?” the trainer asks. “Call the helpline,” say all the women in one voice.

Urban Clap, like other such companies, manages professionals and clients through its call centre and app, rather than specific supervisors. Disconnected from each other and without a formal workplace, there is no avenue for collective bargaining by the partner professionals. The recent fracas of Zomato deliverypersons in West Bengal’s Howrah refusing to ferry beef and pork for religious reasons drew much attention, but the main plank of their protest was reportedly about a fall in pay. “I remember some people tried a hartal in Gurgaon after a driver died: nothing happened, the movement fizzled out,” says Moinuddin. “Ola says it has a Rs 5 lakh accident cover for drivers, but then they should give us the papers to keep, in case something happens,” he adds.

This depersonalised arrangement works fine for Siddiqui, though. She accepts the precarity and is glad for the autonomy that she now has. “I don’t have any impressive degrees, but I know my haath ka kaam, which will stay, even if this company fails,” says Siddiqui. “The gig economy works better for people with special skills,” adds Soundararajan.

“Even as the rate of employment generation fell in the last six years, services employment has gone up, from 127 million in 2011-12 to 144 million in 2017-18,” says economist Santosh Mehrotra. Many new jobs are in this “modern services” sector, in computer services, telecom, financial intermediation, hotels and restaurants. “But what is the quality of these jobs, what are the wages,” he asks. “It is no one’s case that jobs are not being created. It is just that not enough jobs are being created to keep up with the number of people looking for them,” he says.

Meanwhile, Moinuddin also accepts his naseeb, but wistfully remembers his days at the tourism company. “Everything was fixed there. There was a steady salary, a weekend. You could call in sick if you had to. Here, it is all up to you, and you work all the time just to subsist. They say you are khud ka boss, but what does that even mean?”

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