National Council of Applied Economic Research
Opinion: Bornali Bhandari
NITI Aayog’s effort though creditable has loose ends. PLFS should use 2015 worker classification and probe nature of contracts.
At the outset NITI Aayog needs to be complimented for undertaking the onerous task of trying to estimate the number of gig workers. The report ‘India’s Booming Gig and Platform Economy: Perspectives and Recommendations on the Future of Work’ (IBGPE 2022) is indeed a commendable exercise especially given the data lacunae.
The Periodic Labour Force Survey (PLFS) data uses the National Classification of Occupations (NCO) 2004 where there is no classification for gig/platform workers. The NCO 2015 which was released in 2016 would allow one to tease out this information. However that has not been implemented in the PLFS as yet.
For example the occupation of ‘motor drivers’ with Code 8321 in NCO 2015 has four types of drivers. Two types namely auto-rickshaw driver and despatch rider existed in NCO 2004 too. NCO 2015 has added two more — delivery associate/two-wheeler delivery associate and motorcycle drivers (others). Theoretically one should be able to estimate the number of gig/platform workers using the National Industrial Classification Codes in conjunction with NCO 2015.
Therefore we have to search for alternative means to measure the number of gig/platform workers. The IBGPE 2022 is careful to distinguish between the gig and platform economies in its definition following the Draft Code on Social Security (DCSS) 2020.
The DCSS 2020 defines gig workers as a “person who performs work or participates in a work arrangement and earns from such activities outside of the traditional employer-employee relationship”.
The IBGPE states that “gig workers can be broadly classified into platform and non-platform- based workers. Non-platform gig workers are generally casual wage workers and own-account workers in the conventional sectors working part- or full-time.” The DCSS 2020 clearly defines platform workers as gig workers where the non-traditional work arrangement is mediated via an online platform.
Areas to reflect on
The best approach to measuring the number of gig workers is a household survey. Instead the IBGPE has used a data-centric progressive filtering (based on literature review) methodology to estimate the number of gig workers using filters which they best think describe the workers in the Indian context. Here are some issues to ponder:
First including all casual wage workers and own-account workers in the “gig economy” essentially means that we are renaming a part of the traditional informal sector as gig workers. The International Labour Organisation uses the terms gig worker and platform worker interchangeably.
Second IBGPE includes ownership of smartphones as one of the filters to estimate the number of gig workers. This means that we are measuring platform workers because online intermediation is required there. It is ambiguous as to what the IBGPE is measuring — gig or platform. The international literature defines gig work using two separate lenses — flexible work arrangements and online labour intermediation.
Flexible work arrangements have always existed in India. So what is the “new” flexible work arrangement that we are measuring? Further it is not that everyone who has a smartphone will be working in the gig/platform economy.
Third there is a debate in the literature on whether the platform/gig worker is an employee or an independent contractor. The IBGPE does not incorporate this nuance in its methodology. It may add to Indian regulatory concerns.
Fourth workers may have task- or tenure-based contracts. The key feature of a platform/gig economy is ex-ante specified paid task-based contracts. Since PLFS only measures the length of contracts all gig/platform workers would fall in the category of workers with ‘no contracts’.
In PLFS 2019-20 84 per cent of the workers (15-65 age group) were without any job contract and another 4 per cent had job contracts for less than one year. A nuance not accounted for in the IBGPE methodology.
Fifth the IBGPE states that it has included workers whose household consumption is below the 75th percentile of monthly per capita consumption expenditure. But we may be excluding consultants (example doctors) in higher percentiles who take up platform work etc.
Regulatory issues
In the 2020 article ‘Conceptualising the Gig Economy and Its Regulatory Problems’ by Koutsimpogiorgos N Slageren JV Herrmann AM and Frenken K published in Policy and Internet the authors state there are four key defining features of a gig/platform economy which raise key regulatory issues and need to be addressed by policymakers:
Labour versus capital services: Are we including only online labour platforms or capital platforms (assets) as well in the sharing economy? There is of course a continuum here like workers use their own assets like their own vehicles to deliver services.
Online/offline intermediation: Platforms act as online intermediaries between service seekers and providers. The rating systems and algorithmic management change the nature of labour relations and that is the “new” and evolving part of labour relations. But should we include offline intermediation too especially since they have existed in India previously? Notably the IBGPE does not discuss the latter.
Independent contractor versus employee: Is the gig/platform worker an independent contractor or employee? The answer lies in the detail because it will depend on the degree of autonomy the worker has to decide how where and when to produce.
Paid versus unpaid services: In the labour platforms we are looking at paid services. However in capital platforms that may not be the case in India. For example in homestays in India the whole family may pitch in to provide a service which may involve some degree of unpaid household services.
The conceptual debate really is about whether gig workers and platform workers are the same or different and their respective characteristics. Two quick recommendations are that the PLFS should implement the NCO 2015 in its annual surveys and include a question on the nature of contracts that workers have.
The writer is a Senior Fellow at NCAER. Views are personal.