freelancer

This article has been written by Zeba Khan pursuing a Remote freelancing and profile building program from Skill Arbitrage.

 This article has been edited and published by Shashwat Kaushik.

Understanding the concept of freelancing and gig economy

Freelancing means doing a particular kind of work for one or more than one client, on a part-time or a full-time basis,without committing to full-time employment. Unlike full-time employment, where an’ appointment letter’ is issued to the employee after he/she joins the organisation, in freelancing, the terms and conditions of work are mutually decided and thereafter documented in the form of a contract, which is valid for a certain period of time only.

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People who do such work are called ‘Freelancers’ .

Depending on the nature of the assignment and the terms and conditions agreed upon,the freelancer is paid on an hourly/weekly/fortnightly or monthly basis. In some cases,the freelancer is paid only after the completion of the given assignment or project.

Recruitment,teaching, designing/web-designing or graphic design, marketing, copyrighting, photography, data entry, proof-reading, writing and search engine optimisation (SEO) are some of the areas where freelancing is quite prevalent nowadays.

The gig economy refers to an economy that is characterised by freelance jobs, short-term assignments and temporary and part-time jobs taken up by individuals on a contractual basis.

The people who perform such jobs are collectively called “gig workers.” The terms “freelancers” and “gig workers” are often used interchangeably.

Evolution of freelancing and gig economy in India

It is difficult to trace the exact year of origin of the gig economy in India. However,when COVID struck in 2020, people started giving some credibility to freelance work,part-time/contractual jobs and short-term assignments, not only in India but across the world. COVID made a deep dent in the sales and businesses of big multinationals. Their manpower and operational costs started eating into their profitability.

As per news published in ‘The Hindu’ dated May 7, 2020, an estimated 12.2 crore Indians lost their jobs due to the coronavirus lockdown in April 2020. This figure stood at 114 crore across the world in 2020.

This loss of employment was not limited to India; it was felt across the globe. According to the International Labour Organisation (ILO), the number of people who lost their jobs worldwide due to the pandemic reached a staggering 114 crore in 2020. This unprecedented level of unemployment has had far-reaching consequences for individuals, families, and societies around the world.

The reasons behind this massive job loss are multifaceted. The lockdown measures, implemented to contain the spread of the virus, resulted in the closure of businesses and industries across sectors. This led to a sharp decline in economic activity and a subsequent reduction in demand for labour. Additionally, travel restrictions and disruptions in supply chains further exacerbated the employment crisis.

The impact of job losses on individuals and families has been profound. Many have struggled to make ends meet, facing financial hardships and uncertainty about their future. The loss of income has also had a significant effect on consumer spending, further impacting businesses and the economy.

Governments around the world have implemented various measures to address the unemployment crisis caused by the pandemic. These include financial assistance programmes, wage subsidies, and support for businesses to retain workers. However, the road to recovery is long and challenging, and many people continue to face unemployment and economic insecurity.

As societies navigate the ongoing challenges of the pandemic, addressing the issue of unemployment and supporting those who have been affected remains a critical priority. The lessons learned from the economic fallout of the coronavirus lockdown serve as a reminder of the importance of building resilient and inclusive labour markets that can withstand future crises.

The International Labour Organisation (ILO) estimated that working hours lost in 2020 were equivalent to 255 million full-time jobs,leading to $ 3.7 trillion in lost labour income.

These series of events led to a paradigm shift in the way organisations function, irrespective of their size and nature of business.

The concept of ‘Work from Home’ that was earlier prevalent mostly in the IT sector has now become the ‘new normal’. In the pre-COVID era, most of the organisations resisted the concept of ‘work from home’ as they believed it led to a reduction in their employee productivity. But,in order to keep their business up and running, COVID left no choice for the employers but to allow their employees to work from home.

COVID and the changing working environment

On one hand,employers realised the benefits of employees working from home, i.e., reduced manpower and operational costs. On the other hand,multi-skilling and up-skilling became the new mantra for the workforce to deal with any kind of calamity in the future.

The people who were rendered jobless during COVID had no other option but to look for work, irrespective of their area of expertise.

We all know that the second wave of COVID in 2021 was more severe than the first one. More people lost their jobs and many suffered a pay-cut. However,it reinforced the belief of the employers as well as the employees in the concept of ‘work from home’ ,that was adopted during the first wave. At the same time,freelancing,contractual/part-time jobs and project based assignments began to be seen as options to generate income and earn a livelihood.

By the end of 2021, COVID restrictions across the world started easing out and things were gradually getting back to normal. Employees started resuming work from offices and recruitment across sectors also showed an upward trend.

‘Necessity is the mother of Invention’.

The ‘Work From Home’ (WFH) practice, which was the need of the hour during COVID, now became a popular and sought after practice by the workforce in the labour market. Employers too found merit in continuing with the ‘WFH’ practice for at least some of their departments,especially where an interaction with the external stakeholders was not required on a regular basis.

This eventually led to the birth of two new work models across industries and sectors. These were:-

  • Work from Home (WFH) and
  • The hybrid model.

Under the hybrid model,employees have the flexibility to work from home on certain days of the week and from the office (WFO) on other days, depending on the organisation’s needs.

We are now witnessing an upward sweep in the number of freelancers,part-time workers and professionals working on short term or project assignments. We also see organisations advertising the model of work, i.e,(WFO/WFH or hybrid, against their full-time positions. Gigs have surely found a place in the HR manuals of various organisations.

Government regulations for gig workers

As per a press release in HT in October 2023, the Rajasthan government released the draft ‘Rajasthan Platform Based Gig Workers’ (Registration and Welfare) Bill, 2023, the first legislation of its kind in India outlining social security and welfare measures.  It also  invited feedback from stakeholders, including the state’s approximately three lakh gig workers, till July 7.

The HT release also stated that “the demand for a legal framework echoes throughout India’s 77-lakh-strong gig workforce (expected to swell to 2.34 crore by 2030). Gig workers, portrayed by many companies as ‘partners’ partaking in an ‘economic revolution’, often work unregulated hours, receive inadequate wages, do not have social security, and face discrimination and harassment at the hands of both companies and customers”.

‘Populii’ launched by Tech Mahindra”

The business section of Hindustan Times dated December 14, 2023, published the news of Tech Mahindra (Tech M) launching ‘Populii, 13th December 13, 2023.’  The release mentioned that “Populii’ is a crowdsourcing platform that enables gig workers to collaborate with leading organisations through micro jobs requiring ‘human in the loop’ services.

According to the HT release,gig jobs on Populii will include content rating,data collection,data transcription and data annotation of multiple data types. This platform aims to create flexible work opportunities for the gig workforce while equipping businesses with reliable data from trained and qualified candidates to build competitive artificial intelligence (AI) algorithms. Populii is designed to connect businesses with a vast network of experts, innovators, and problem solvers from diverse backgrounds and industries. Built on the principles of open innovation and shared expertise, this platform empowers businesses to tackle complex challenges, accelerate growth, and drive digital transformation.

Through Populii, businesses can post specific challenges, problems, or requests for proposals and invite the global community to contribute their unique insights, ideas, and solutions. This collaborative approach leverages the collective intelligence of the crowd, enabling organisations to access a broader range of expertise, perspectives, and out-of-the-box thinking.

For individuals, Populii offers an exciting opportunity to showcase their skills, solve real-world problems, and contribute to innovative projects. By participating in challenges, individuals can gain recognition, rewards, and the chance to collaborate with leading companies on cutting-edge initiatives.

The launch of Populii has been met with great enthusiasm from both the business community and tech enthusiasts alike. Tech Mahindra’s vision of fostering a global ecosystem of innovation aligns perfectly with the evolving demands of the digital age, where collaboration and knowledge sharing are key drivers of success.

Merits and demerits of freelancing and gig work

Even though freelancing and gig work are gaining momentum in the labour market, it is of utmost importance to do a SWOT analysis of this model of work.

Merits 

The growing popularity of freelancing and gig work can be attributed to the following reasons:

  • Flexibility- The biggest advantage of freelancing and gig work is flexibility with respect to the place of work, time of work and kind of work. A freelancer also has the freedom to choose the clients and projects he/she would like to take on. This also helps in creating a healthy work-life balance.
  • Control- A gig worker has complete control over the amount of workload he/she might want to take on at any point in time.
  • Exposure- By working with different organisations and different brands located in different geographies,freelancers get a lot of exposure, which may develop into meaningful business relationships around the world. Such exposure may not be possible while working with one organisation at a time.
  • Improved skill set- Working with different clients /different projects with different parameters hones the existing skills of the freelancers and may also enable him/her to acquire new skills
  • Setting your own rates- A freelancer is his/her own boss. They themselves set and decide their own rates or remuneration,depending on the amount of work they can take on in a certain period of time.

Demerits

The following points shed light on the flip side of freelancing and gig work:

  • No job security and stability- Unlike a full-time job,a freelancer does not have any kind of job security or stability. There is no job-continuity or guarantee that the freelancer will get more work or more projects from the same client in the future.
  • No employer funded benefits- Employee benefits such as medical and accidental insurance and paid leave,which are a given in most full-time jobs,do not exist for freelancers and gig workers.
  • Isolation- With no team to work with and no colleagues to interact with,freelancing can lead to feelings of loneliness and demotivation. A freelancer has to completely rely on self-motivation to keep the work going.
  • Delay in payment- One of the biggest challenges freelancers face is a delay in payment or a shortfall in payment of remuneration without assigning any valid reason. This wastes a lot of time for the freelancer in following up with the client, apart from setting in feelings of demotivation and frustration.
  • Administrative responsibilities- Since a freelancer mostly works in isolation,all the administrative work, such as invoicing, taxation, and marketing, has to be done by the freelancer himself/herself.

Opportunities

Multiple assignments-multiple clients- The biggest opportunity is that a gig worker may simultaneously work on more than one project with more than one client at a time.

Can be taken up by students before their course completion- Freelancing offers a huge opportunity to students pursuing any kind of course. It may help them to ‘earn and learn’ together. This may give them an edge over others when they apply for full-time jobs after their course completion.

Fills in the gap between theory and practice- As mentioned in the above point,a freelancer has the opportunity to gain practical experience in a particular stream in which he/she is simultaneously obtaining theoretical knowledge.

No age constraints- Freelancing does not have any age criteria. A freelancer only needs to have adequate knowledge to be able to take on an assignment in his/her area of work.

Fill in the gaps arising due to career breaks- Professionals,especially women, go on career breaks and sabbaticals to raise children or look after their families. However, after having worked in a corporate set-up,one may feel isolated and out of touch with their respective field of work. Freelancing offers a good opportunity for such individuals to stay connected with their area of interest without the rigour and hassles of a full-time job.

Threats

Misuse of confidential information- Freelancing and gig work are definitely not good options where there is a threat of extremely confidential and sensitive information being  leaked out. The freelancer may use that information to reach out to the competitors after the completion of the contract with a particular organisation.

Less commitment to the organisation- A freelancer is not a regular employee of the organisation. They have limited day to day interaction with the employer. As a result, the commitment and loyalty to the organisation may not be the same as those of a regular employee.

Reliability is a concern- Since freelancing and gig work are only for a short period of time,the organisation cannot rely on the services and support of the freelancer after the contract is over.

Fixing accountability is difficult- In the case of incomplete or sub-standard work,the maximum the employer can do is hold on to the remuneration and not renew the contract of the freelancer. The accountability,however, for any sub-standard work remains with the organisation.

Conclusion

Like any model of work, freelancing and gig work too have their positives and negatives. The exponential rise of this kind of work in the last few years has prompted the government to think about laying down certain rules and regulations for gig workers. In India,the Rajasthan government is the first to take this kind of initiative.

According to me, even though freelancing and gig work have created a space for themselves in the labour market, they are still at a nascent stage. A lot of work still needs to be done. One very important step that needs to be taken is establishing a framework of rules and regulations that govern both gig workers and employers offering gig work. Only then can we reap the full benefits of freelancing and gig work.

References

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