The gig economy has been a growing phenomenon in recent years, with a new World Bank report revealing that it accounts for up to 12 percent of the global labor market. This percentage is much higher than previously estimated, indicating the significant impact that online gig work is having on the workforce. The report, titled “Working Without Borders: The Promise and Peril of Online Gig Work,” sheds light on the potential opportunities and challenges that this sector presents, particularly for women and youth in developing countries.
One of the key findings of the report is the rapid growth of demand for online gig work in developing countries. While developed countries currently dominate the demand for gig workers, the growth rate in developing countries is outpacing that of wealthier nations. For example, job postings on the largest digital platform in Sub-Saharan Africa grew by 130 percent, compared to just 14 percent in North America. This trend highlights the potential of online gig work to provide people in low- and middle-income countries with an additional path out of poverty.
The report also emphasizes the role of online gig work in addressing youth unemployment and increasing labor market participation for women. Young people are attracted to gig work for various reasons, including earning income, learning new skills, and having the flexibility to balance work with other commitments such as school or additional jobs. Women, in particular, are participating in the online gig economy to a greater extent than in the general labor market, indicating the potential for greater gender inclusivity in this sector.
Despite the promising opportunities that online gig work presents, the report also highlights some potential perils. In low-income countries, most gig workers operate outside the purview of labor regulations and lack access to social insurance and benefits. Additionally, there is a considerable wage gap, with women earning just 68 percent of men’s wages on one major online platform reviewed. These challenges underscore the need for policymakers to take action to ensure that gig workers are protected and have access to social protections.
The report lays out recommendations for policymakers to help realize the potential of online gig work while mitigating the associated risks. By investing in digital infrastructure, partnering with digital platforms to provide support and training for workers, and experimenting with new social insurance and collective bargaining models, developing countries can leverage this growing part of the labor market to create more opportunities, expand economic inclusivity, and increase prosperity for their people.
In conclusion, the gig economy holds great promise for women and youth in developing countries, offering them new opportunities for income generation and skill development. However, it is essential for policymakers to address the challenges faced by gig workers, such as lack of social protections and wage disparities, in order to ensure that this sector can contribute to inclusive and sustainable economic growth. For more information on the report, visit the World Bank’s website.
