Nothing Dickensian about gig work
The gig workers‘ strike planned for December 25 and 31, 2025, may have failed to draw significant participation, but it has sparked a debate on the welfare and rights of workers. Unfortunately, much of this debate rests on a flawed premise: economic viability of platform companies and the welfare of gig workers are orthogonal. This reflects a misunderstanding of the role that platform companies play, and of constraints, incentives and agency that characterise gig work.
Livelihood generation
Today, the gig economy constitutes a critical segment of the economy. This is reflected not only in the market capitalisation of listed platform companies but also in their role in livelihood generation. Economic Survey 2024-25 notes that these companies have transformed traditional service sectors into a digitally driven ecosystem. A 2022 NITI Aayog report states that India had about 7.7 mn gig workers in 2020-21. This is projected to more than triple to 23.5 mn by 2029-30, accounting for more than 6% of non-agricultural employment.
This impact is visible in food delivery. In 2023-24, the sector’s gross output was around ₹1.2 lakh cr, providing direct earning opportunities to over 1.37 mn people. Encouragingly, this was traditionally lagged. A 2023 NCAER survey found that nearly 70% of food delivery agents worked in their hometowns, and 32% were unemployed before joining platforms, highlighting the gig economy’s role as a livelihood-generator, and safety net.
Positive spillover effects
Owing to delivery-based apps, there is expected to be an increased demand of nearly 80 lakh vehicles over the next 5 yrs. Majority of restaurants surveyed by NCAER reported increased traffic after joining such platforms.
Informal but formal
Most gig workers are medium- or low-skilled, and platform work offers an alternative to the uncertainty of informal manual labour. The payouts are processed faster than traditional employment setups, and there is almost no default risk. Although not on payroll, they operate under formal, legally enforceable contracts.
Ease of entry
Unlike traditional occupations, which are tightly regulated (e.g., autorickshaw permits) or mediated by personal networks and usurious contractors, gig platforms have minimal eligibility criteria. Ownership of a two-wheeler and a valid driving licence is sufficient, some even permit bicycles. Task allocation is conducted through probabilistic algorithms, reducing bias and arbitrariness.
More power to workers
The gig economy has expanded worker agency, who now control where they work, when they work, and how much they work. A distinctive feature is the effective ‘right to exit’. The demand for gig workers exceeds supply, allowing workers to shift platforms easily. This reverses traditional power dynamics, forcing platform companies to compete for workers’ time.
Competitive earnings
A regular delivery partner with Zomato, on average, earns a net income of more than ₹20,000, which is higher than that of many entry-level formal jobs. Among short-shift workers, gig work accounts for roughly one-third (33%) of their total income and requires about the same number of work hours (37%), indicating that gig platforms are not underpaying. For many, this is supplementary income.
Continued worker participation despite revenue-sharing arrangements demonstrates the value platforms provide through market discovery. Independent service providers face no legal barrier to approaching customers directly, yet choose platforms because these eliminate search and transaction costs, which helps explain why autorickshaw drivers have adopted rider apps.
Misguided activism risks more harm than good. Demands such as mandating permanent employee status for gig workers or eliminating penalties for repeatedly rejecting tasks are either infeasible or counterproductive. Treating all gig workers as permanent employees would collapse the platform model. Most platform companies remain loss-making. Their sustainability is essential for workers’ welfare. Companies also need to ensure service reliability.
However, worker welfare should not be ignored. The sensible path forward lies in industry-wide best practices, including social security provisions and trainings. The Code on Social Security 2020 has laid down a framework for the social protection of gig and platform workers. The draft Social Security Rules operationalise this framework by defining eligibility, registration and coverage mechanisms, including minimum participation thresholds across one or multiple platforms.
Eventually, the choice is not between viable platforms and worker welfare. A sustainable gig economy depends on recognising that these are complementary, not competing, objectives. India’s gig economy is not a Dickensian 19th-c. workhouse. It is a 21st-c. marketplace – entered by choice, sustained by demand, and exited at will.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
