The gig economy increases in popularity.
The lack of payment methods like PayPal restricts freelancers’ ability to develop.
KARACHI:
In Pakistan, where people work flexible hours as entrepreneurs and are effectively their own bosses, the gig economy is growing despite obstacles.
Pakistan still has a long way to go in relation to the gig economy, even though traditional employment may have lost part of its appeal among some populations. The gig economy concept is still generally used only as a secondary source of income because it is not well understood.
Hassan Arshad, Director of Policy and Communications at FoodPanda, said in an interview with The Express Tribune that one of the main issues facing the gig economy labour force today is to assist them capitalise on their current skill sets rather than think about upskilling.
“The existing digital skills training programme and the laws governing freelancing are at odds with one another. In addition, he noted that a comprehensive policy framework must be developed immediately to safeguard freelancers employed in the nation’s developing gig economy.
“The gig economy can be divided into domestic and foreign industries. Globally, we lack payment channels, particularly PayPal, which has a negative impact on our slow growth, according to Shahzad Khan, a Gig Economy Expert.
“We do provide payment options like Payoneer and Skrill, but our foreign customers don’t use them. Clients hesitate when we instruct them to utilise these for payment. Trust is difficult to establish, particularly when money is involved. Customers from other countries typically utilise PayPal, which is inaccessible in Pakistan. This prevents independent contractors from realising their full potential, he said.
“The vast majority of Americans utilise PayPal to make online purchases. They are hesitant to proceed with the transaction when you give them an account for a new app. Pakistani-based freelancers also find it difficult to comprehend the subtle cultural differences in other markets. Most Pakistani freelancers won’t do as well as the international industry unless we close this gap, said Khan.
Pakistan has established a number of payment options, however acceptance by the general public has been gradual.
According to projections from the Organisation for Economic Co-operation and Development (OECD) for 2018, the platform economy in Pakistan employs about 2% of its labour force through online and location-based services. With its substantial youth bulge, experts are still puzzled as to how Pakistan may raise this pitifully low number.
The United Nations Development Programme (UNDP) estimates that every year in Pakistan, four million young people reach the working age. But just one million of them are able to get employment.
“We must act quickly to establish the ideal conditions for more young people to participate in the gig economy. A reliable cash transfer system must be in place for gig workers in addition to expanding nationwide Internet access, said Khan.
“The proper public-private cooperation can help create more possibilities and provide young people the tools they need to take advantage of the gig economy. For instance, the government can work with the private sector to train individuals with the necessary skill set (such as driving), which can then be used to offer sustainable livelihoods (through working gig platforms) as well as via support offered through other financial and youth empowerment packages, he continued.
Khan continued, “Unfortunately, the government does not offer social security to freelancers, and businesses do not regard them as legitimate employees.
The FoodPanda director argued that “the autonomous gig working model gives economic and financial options that empower these riders to seek sustainable lifestyles.”
“FoodPanda riders typically make more than Rs150 per hour. The tips that passengers provide for the riders are not included in this sum. According to Arshad, the cost of fuel and other related expenses might range from 10% to 15% of their base salary.
Although there are also full-time riders, having the flexibility of working as independent contractors with FoodPanda allows riders to augment their income from other full-time (existing) occupations. Riders may often expect to make between Rs38,000 and Rs45,000 per month working six days a week for 8 to 10 hours per day (effectively a full-time job). According to the current law, this is at least 35–40% higher than Pakistan’s minimum pay rate, Arshad emphasised.
