From UPSC perspective, the following things are important :
Prelims level : Unemployment
Mains level : Paper 3- Support to gig workers
With the lack of NREGA equivalent in the urban area government has to find ways to provide income support and employment. The article suggests ways to do the same.
Slowdown in employment recovery
- The Indian economy has been gradually recovering from historic contraction of negative 23.9%.
- This recovery has shifted focus away from the employment question, considered resolved after a sharp rally following the collapse in employment numbers in April.
- More recent data from the Centre for Monitoring Indian Economy, however, point to a gradual slowdown in employment recovery.
NREGA: employment support in rural area
- For labour coming back to rural India, employment support came in the form of the National Rural Employment Guarantee Scheme (NREGA), which witnessed a 243% increase in person workdays.
- This increased dependency on NREGA, has seen the Rural Development Ministry spend nearly 90% of its increased ₹86,4000 crore allocation by the month of November.
- In several Indian cities, however, closed businesses have meant that millions of workers have either had to leave or have had to take up new forms of work.
Supporting gig workers
With no urban equivalent to the NREGA on the horizon, there must be an increased impetus on evaluating, regulating and supporting new forms of employment.
- Our current understanding of gig work is based on the limited disclosures made by the platforms themselves.
- Furthermore, most regulators continue to remain in the dark on basic questions surrounding platform labour.
- As of now, there exists no authoritative estimate on the total number of gig workers in India.
- The centralised nature of the platforms and the larger platform labour market should make the collating of this data relatively straightforward for the Labour Ministry.
- The next step is significantly more sensitive and involves regulation.
- The reason for the sensitivity primarily revolves around the varied nature of gig work.
- While some workers use these platforms as a “side hustle”, for others it continues to serve as a primary source of employment.
- This dynamic is further complicated by the risk of a one-size-fits-all regulatory strategy.
- Such regulatory strategies are unintentionally hurting the similar, yet distinct, market for highly skilled (and highly paid) freelancers.
- A more viable strategy then would involve conditional government partnerships with platforms under some of its flagship schemes.
- The successful pilot of Swiggy’s Street Food Vendors programme under the PM SVANidhi, or PM Street Vendor’s Atma Nirbhar Nidhi scheme, may prove to be an illustrative example.
- Creation of jobs, alongside the voluntary adoption of quality standards, is an example of a mutually beneficial partnership between the state and platforms.
- Similar collaborations on urban employment, that require labour platforms to comply with disclosure norms and worker compensation standards to access government support, could create jobs while ensuring compliance.
- Collaborating with platforms to employ workers, would bring down costs significantly (for both the state and their partners) it would also create an environment where firms would be more likely to cooperate with the state.
Limited fiscal space and a growing need to fuel the country’s consumption base, must push the government to build symbiotic relationships with new partners.