According to an ASSOCHAM report, India’s gig economy is projected to reach $455 billion by 2023.
The COVID-19 is not only a global health crisis; its pervasive ramifications extend to the global economy. India’s GDP for the first quarter contracted by 23.9% Y-o-Y in FY2020 for the first time in more than 40 years, as evident from the National Statistical Office survey. Most firms have resorted to downsizing the workforce, pay-cuts, furloughs and reduction in perks and emoluments to stay afloat. According to the Centre for Monitoring Indian Economy (CMIE) estimate, 21 million salaried professionals had lost their jobs until August 2020. Furthermore, the hiring scenario ahead is expected to be bleak, if the Manpower Group Employment Survey is anything to go by.
To tide over joblessness, the laid-off professionals are now taking up gig roles. The COVID-19 has invariably given a fillip to the gig economy. Unlike full-time salaried professionals, the gig economy relies on job roles that are paid on an assignment basis rather than a fixed salary. It implies a shift from the conventional 9-to-5 job to freelance, task and incentive- based work. A BetterPlace report highlights that the gig economy would comprise over 4 lakh jobs out of more than 21 lakh job opportunities created across select job verticals in 2019-20.
Until now, the gig nature of job roles was confined mostly to the blue-collar workforce. There were limited companies in the space that adopted this model for cost-efficiency and incentive-based structure. Now, even multinational firms are not shying away from embracing this model to navigate through this unprecedented time owing to the work-from- home model and economic uncertainty ahead. As a result, there has been a massive change in demand-supply dynamics in freelance job search websites.
The expansion of the gig economy to white-collar jobs has several consequences. The professional services are complex and reinforce the need for collaboration and precise outcome assessment models. The advent of digitization and the proliferation of technology have made it easier to break down the work into parcels to be distributed to the workforce across geographies.
According to an ASSOCHAM report, India’s gig economy is projected to reach $455 billion by 2023.
Technology
It is here wherein HR- technology plays a paramount role in maintaining the sourcing and acquiring talent, comprehensive database of the workforce, keeping a track of their attendance, assessing their productivity in line with the business outcome and much more. It is directly linked to ‘OUTCOMATION’ which aims at achieving tangible and measurable business outcomes like Top Line, EBIDTA, people efficiency, people productivity. This is a big opportunity for firms to realize the potential of HR- tech solutions and leverage them for better outcomes. Equally important will be the role of the HR function in ushering a tech-driven culture to achieve business goals.
Learning & Development, Skilling
In the post-COVID-19 scenario, we foresee firms to reevaluate their business outcome from ‘value for money’ and ‘cost-effective’ perspectives that underscores the need for them to invest in learning and development of employees for diverse skills-sets. From the workers’ perspective, learning and development will be the key to mitigate economic risks and ensure a stable and assured source of income.
Sense of Belongingness, Engagement
The work-from-home model also implies that firms need to go the extra mile to impart a sense of belongingness to employees, especially amongst those on contractual or freelance roles, to retain them. Employee engagement will be the key to make their experience lively and interactive besides ensuring their overall well-being.
The COVID-19 pandemic has allowed us to pause, think and reflect, on the emerging priorities. At policy level, it implies the formulation of a proper framework to facilitate a smooth transition. Revamping of labor laws, strengthening digital infrastructure, improving network bandwidth and connectivity and implementing a stringent mechanism to ensure data privacy and security are the need of the hour.
Prasad Rajappan is the Founder, MD & CEO of ZingHR, a leading cloud-based enterprise HCM platform offering services on a SaaS model. He has earlier founded FileMyReturns.com, a platform for e-filing Income Tax returns, and Cnergyis, an enterprise HR technology and outsourcing and services company. Previously, he has held key positions at leading brands like Reliance Industries, Ernst & Young, and Mahindra & Mahindra.