India: Blinkit Strike Reveals the Problems of the Gig Economy

India: Blinkit Strike Reveals the Problems of the Gig Economy
Photo: startuptalky.com 20.04.2023 1027

Indian Zomato said that its business was not affected by the strike of delivery partners, but the incident provoked a wave of discussion about the rights of gig workers in India.

Last week, partners of Blinkit (owned by food delivery service Zomato), which deals with the delivery of food, went on strike due to lower payment for the order.

The company has reportedly reduced the payout from Rs 25 to Rs 15. As a result of which, over 100 dark kitchens in Delhi, Gurugram, Faridabad have been shut.

The strike at Blinkit reflects deeper problems within the hyper-competitive e-commerce market in the country, the Indian media noted. In a fierce battle for market share, companies often lose sight of the  working conditions of their partners. Rapid growth and aggressive competition can result in disgruntled workers, putting businesses at risk.

Twitter users also pointed out that Zomato is spending crores on marketing and advertising every month, but is refusing to compensate its delivery executives fairly, attracting a lot of backlash from social media users.

Strike as an Essential Part of the Gig Economy

India has previously witnessed protests and strikes by workers in the e-commerce and gig economy sectors. In 2020, delivery partners  of the food delivery service Swiggy staged protests in Chennai, demanding higher pay and transparent incentive policies. Zomato, another food delivery giant, faced delivery partner strikes in 2019 over reduced payouts.

The ride-hailing industry in India, represented by companies like Ola and Uber, has experienced similar unrest. Protests and strikes have been organised by drivers on multiple occasions, demanding better pay, incentives, and working conditions.

It's not just in India that gig economy workers are on strike. In 2018, Amazon warehouse workers in Europe went on strike during the busiest shopping day, demanding better pay and working conditions. The strike brought attention to the plight of workers. In 2020, workers of U.S. grocery delivery service Instacart staged a nationwide strike, demanding hazard pay and protective gear amidst the COVID-19 pandemic. The pressure eventually led the company to provide additional benefits, such as paid sick leave and bonuses for frontline workers.

Growth Without Regard to People

India's gig economy has witnessed tremendous growth in recent years, driven by the rapid expansion of technology platforms and increased demand for flexible work opportunities. According to a study by the Boston Consulting Group (BCG) and the Michael & Susan Dell Foundation, the Indian gig economy is expected to grow at a compound annual growth rate (CAGR) of 17%, and MasterCard predicts it will reach a market value of $455 billion in 2023. This growth has created millions of jobs in various sectors, including ride-hailing, food delivery, and e-commerce logistics.

India's gig economy could serve 90 million jobs and over 1 per cent of the GDP.

Despite the rapid expansion and promising prospects, India's gig economy faces numerous challenges. The most pressing issues for gig workers include the following:

  • Lack of job security
  • Absence of social security benefits
  • Inadequate legal protection

Gig workers often work long hours for low pay without access to benefits such as paid leave, health insurance, or a pension. The COVID-19 pandemic further exacerbated these concerns, as gig workers were among the hardest hit by job losses and income uncertainty.

How India is Trying to Help Gig Workers

India's government and judiciary have taken steps to address the concerns of gig workers. For example, in September 2020, parliament passed the Code on Social Security, which seeks to extend social security benefits to gig and platform workers, including life and disability insurance, health and maternity benefits, and old-age protection. However, implementing these measures remains a critical challenge, with many workers still needing help to access the promised benefits.

As India's gig economy continues to grow, it's important to strike a balance between fostering innovation and ensuring the well-being of workers, experts say. To make the e-commerce sector more sustainable, companies must invest in their workforce and prioritize their needs. Only then can they foster an environment of trust and loyalty, which is essential for long-term success.

More and more projects are appearing in India  to eliminate the need for intermediaries or platforms. According to the government, it's time for industry players to rethink their priorities and put worker well-being at the heart of their growth strategy.

Solutions such as NammaAuto (a Bengaluru-based autorickshaw ride-hailing app that does not charge drivers a commission and ensures they retain a larger share of their earnings), BECKN (Bharat Ecosystem for Commerce & Knowledge Networking), and ONDC (Open Network for Digital Commerce), represent a model for a equitable and sustainable ecosystem to replace centralized platforms.

Source: NDTV

digital markets  India 

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