Daily Times

According to the National Human Development Report (NHDR), almost a million new jobs need to be created every year over the next five years. If labour force participation rates are to be improved, an additional 1.3 million jobs must be created each year for the next five years. The International Monetary Fund (IMF) has projected that inflation and unemployment rates will increase in Pakistan during the current fiscal year. The unemployment rate – which declined to 6.2 per cent in FY 2022 – is projected to rise to 6.4 per cent in FY 2023. The World Bank has projected the growth of Pakistan’s economy to be only two per cent by the end of FY 2023. The current economic situation demands innovative solutions like focusing more on the gig economy and developing a viable technology and services-driven start-up ecosystem to create more jobs and address the issue of unemployment.

The gig economy refers to the growing trend of individuals engaging in short-term, flexible work arrangements, such as freelancing, temporary contract work, and on-demand tasks. As technology has become more inclusive, it has impacted the workplace and traditional employment as much as anything else. An increasingly larger number of people have started working as independent contractors or freelancers, contributing to the constant growth of what is now called the gig economy or the sharing economy. It also allows people to work remotely in more flexible work environments. In a developing country like Pakistan, where unemployment is high and 64 per cent of the population is under 30 years of age, the gig economy model seems to be an effective measure to reduce unemployment.

As much as long-term, permanent positions make up the core of any workforce, numerous jobs are becoming more project-based and temporary. Employers benefit most from this agile new work culture, as they can access diversity and put the most skilled individuals and teams to use without costly retention of in-house teams. The gig economy has its fair share of benefits for workers as well. For instance, freelancing on online platforms empowers people to use their talent and skills to earn competitively. It provides flexibility and the ability to work on one’s own terms, as well as a greater deal of freedom and autonomy. According to the Ministry of IT and Telecommunication (MoITT), freelancing brought foreign remittances worth US $397 million to Pakistan in FY 2022 and has the potential for more. With over 54 per cent of the total population online, as per the Pakistan Telecommunications Authority (PTA), the possibilities offered by integration with the digital gig marketplace are high.

With over 54 per cent of the total population online, the possibilities offered by integration with the digital gig marketplace are high.

Companies like Uber, Cheetay, Fiverr, and Upwork have made it easier than ever for people to earn by acting as services-driven platforms. In recent years, Pakistan has seen an increase in the number of people working as delivery riders for online food and grocery delivery services, home-based chefs, cab and bike drivers for ride-hailing companies, and other delivery services. Many participate in the gig economy on a part-time basis to augment income or while they study. The rapid rise of e-commerce and start-ups offering various services have altered how Pakistanis eat, travel, shop, and do their groceries; challenging traditional views of work and employment. On a limited scale, projects such as e-Rozgaar by the government of Punjab Information Technology Board (PITB) have provided training opportunities to youth for self-employment through internet-based freelancing.

However, this changing nature of the employer-and-employee relationship also poses many challenges. The current, mostly unregulated, state of the sharing economy often falls short of ensuring employee rights and fair working terms. Gig workers being classified as independent contractors are usually not covered under the laws and regulations that govern traditional employment. For instance, freelancers are not provided with social security by the government and are not treated as proper employees by organisations. Lack of job security is another vital issue. Without the protections and benefits of stability that usually accompany traditional employment, gig workers are often left to navigate a precarious financial situation and labour insecurity.

The rising unemployment rate in Pakistan and the limited job opportunities for the growing youth bulge necessitate a comprehensive policy framework at the national level to invest more in education and skill development required for keeping up with economic transformation. The remote work aspect of the gig economy model is also more inclusive as it facilitates the participation of women with considerable ease. There has been considerable growth in women-led start-ups like Sehatkahani, which is a telehealth platform that provides the opportunity to home-bound female doctors unable to practice medicine out in the field. Initiatives like this are positive steps toward integrating valuable human resources back into the economy.

There is still a need to enhance the productivity and skill set of freelancers, entrepreneurs, and remote workers. The right public-private partnership can help open up new opportunities and give young people the tools and skills they need to take advantage of the gig economy. The government can collaborate with the private sector to train individuals in the necessary skill sets, such as web development, graphics designing, and digital marketing, which can then be capitalised upon by providing sustainable livelihoods through the gig economy and remote work. Similarly, the government can encourage Pakistan’s start-up ecosystem by facilitating entrepreneurial training as well as soft skills such as communication and negotiation skills, as well as setting up financial literacy and youth empowerment programmes, especially for women. Innovative solutions and platforms made possible by and empowered by technology can greatly assist Pakistan in retraining and engaging its considerable workforce toward higher levels of productivity and economic output.

The writer is a researcher at the Centre for Aerospace and Security Studies (CASS), Lahore, Pakistan. He can be reached at info@casslhr.com.