Booming GIG Economy: Boon for Companies, Bane for Employees

This article was published in September 2025 Issue of New Democracy. Written by Mrigank

The GIG economy is flourishing day by day. App and platform-based work is taking precedence over traditional work. It appears convenient to end customers, it is burdensome to workers and profitable to the company. Almost for everything, many platforms, aggregators and Apps have come up, and some of them are dominating the market. We shall try to examine and understand the modus operandi and economic reasons behind this.

What Is GIG

The word GIG has taken on many meanings over time, but in today’s context, it typically refers to a temporary, flexible job performed for payment. The term originated in the world of music, where performers were hired for single events or short-term engagements. Over time, this idea has expanded to include nearly any kind of short-term work across various industries.

A GIG usually involves completing a specific task or project on an as-needed basis, often with flexible hours and rates. Workers in the GIG economy are not tied to a single employer and can take on multiple jobs simultaneously, assembling their income from a variety of sources. While individual GIGs may offer modest pay, consistent participation in multiple GIGs can lead to earnings comparable to regular employment. However, these arrangements typically lack the structure and benefits of a traditional employer-employee relationship.

The GIG economy challenges the conventional model of full-time employment, where individuals build long-term careers within a single organization. Today, the GIG workforce includes delivery drivers, rideshare operators, freelance developers, online tutors, consultants, and many others. As this model continues to grow, it reshapes how we think about work, income, and job security in the modern world.

History

By the turn of this century, advances in information and communication technology were rapid and quickly passed on to end users, making smart phones with various apps a common part of daily life. At the same time, the digitalization of the economy allowed a growing number of people to complete transactions entirely online. Together, these developments fuelled the rise and rapid growth of the GIG economy.

Traditionally, work was defined as full-time employment with fixed hours and associated benefits. However, persistent economic factors including greed to maximize the profit and rapid technological advancement have reshaped this concept, leading to a labour market increasingly dominated by independent and contract-based work.

Initially associated with musicians and artists, the GIG economy has since expanded into many sectors. With the rise of digital platforms like Uber, Airbnb, and TaskRabbit, GIG workers have become vital to services such as transportation, temporary lodging, and short-term tasks. As a result, both the number of GIG workers and the variety of jobs they perform have grown significantly.

Emergence of GIG Economy

One must investigate the economic and employment scenario to understand the rise of the GIG economy.

India is expected to have a large number of GIG jobs by the end of 2025, making it one of the most sought-after GIG economy locations. Over 15 million independent contractors are employed in India now in a variety of industries.

The GIG economy emerged gradually. The economy took time to develop. Corporate work cultures that were stressful and unpleasant gave rise to freelancing. Millennials began choosing to work as freelancers. Additionally, the start-up economic model promoted contractual freelancers because they could engage staff according to the capabilities required for a certain project and avoid expensive fixed expenses. Contractual freelancers have become more common as a result. MNCs adopted flexible hiring choices because of the worsening economic crisis. As a result, GIG culture began in fields including software development, machine learning, and data science. Even though it started out in such technical professions, it has defined a notion and demonstrated how to use it further in other jobs.

Growing unemployment and manufacturing's decline have both contributed to the GIG economy's expansion.

There is a continuous decline in the employment rate in India. Between 2011 and 2016, unemployment was between 4 and 5%, but job creation did not keep pace with the growth of the workforce. 2017–2019: Demonetization (2016) and the introduction of the GST (2017) caused a significant increase in unemployment, which reached 6.1% in 2017–18 (PLFS). 2020–2021: Unemployment rose to 23.5% due to COVID-19 (April 2020, CMIE), then leveled off at 7–8%. 2022–2024: Youth unemployment (~15–20%) is a significant worry, and unemployment decreased a bit but remained high (~7–8%, CMIE).

The manufacturing sector is performing poorly. Its share is stagnant at about 15–17% (the Make in India objective was 25%). Between 2014–19, the annual growth rate was roughly 7%; in 2021–24, it was 4-6%. Steel and heavy industries, labour-intensive industries like textiles and leather, and MSMEs (post-demonetization and GST issues) have all suffered significant setbacks and have fallen behind Bangladesh and Vietnam. Those previously working in these industries are now part of a sizable army of unemployed people.

These factors have contributed to a boom in the GIG economy- Companies wanted to reduce their cost and available workers due to unprecedented unemployment.

The Facts and Figures of the GIG Economy

The GIG economy in India has grown significantly and is still growing rapidly. Approximately 15-20 million workers, or 4-5 % of the non-agricultural workforce, were involved in GIG work in 2020–21. This figure may rise to 50 million by 2029–2030, according to projections, making up 10-12 % of the non-agricultural labour. According to financial estimates, the GIG economy's market size was $45 billion in 2024, and growth is predicted to continue. The GIG economy sector is expected to increase at a compound annual growth rate (CAGR) of roughly 16.18% from its estimated $50 billion in 2024 to $2.15 trillion by 2033.

GIG is used in  Food & Grocery Delivery like Swiggy, Zomato, Blinkit, BigBasket, Dunzo; Ride-Hailing & Taxi Services like Ola, Uber, Rapido, Meru Cabs;  Logistics & Last-Mile Delivery like Porter, Amazon Flex, Flipkart (Ekart Logistics), Shadowfax; Home & Professional Services like Urban Company, Housejoy, Taskmo;  Healthcare & Pharmacy Delivery like PharmEasy, 1mg, Practo; Freelancing & Professional GIG Work like Upwork (India Operations) for IT, design, writing, marketing freelancing, Fiverr (India Operations) for Digital services (graphic design, programming, etc.), Toptal for Premium freelance talent (developers, designers), Freelancer.com (India) for General freelance GIGs;  E-Commerce & Quick Commerce like Zepto, Instamart (Swiggy), JioMart; Miscellaneous GIG Work like BYJU’S (WhiteHat Jr) for  Online tutoring (freelance teachers). Quikr for Local services (repairs, tutoring, rentals), WorkIndia for Blue-collar job matching (delivery, security, etc.). These are just a few names and not a comprehensive list.

The extent of the GIG economy can be seen from the following representative table.

Name of Company	Type of work	Annual turnover in Crore Rupees FY 2023	Employees
Swiggy	Food delivery, grocery delivery, and instant pick-up/drop services.	5,000	300,000+
Zomato	Food delivery, dining-out services, and hyperlocal deliveries.	7,000	250,000+
Uber	Ride-hailing, bike taxis, and food delivery (Uber Eats).	2,500  (India-specific)	600,000+
Ola (ANI Technologies)	Ride-hailing, bike taxis, and electric vehicle services.	2,200	1,000,000+
Urban Company	Home services (beauty, cleaning, repairs, etc.).	1,000	50,000+
Dunzo	Hyperlocal delivery (groceries, medicines, etc.).	200	20,000+
Rapido	Bike taxis and delivery services.	300	500,000+
Amazon Flex	Last-mile delivery for Amazon orders.	Not disclosed (part of Amazon India)	100,000+
Flipkart (Ekart)	E-commerce logistics and last-mile delivery.	Not disclosed (part of Flipkart).	150,000+
BigBasket	Grocery delivery and supply chain logistics.	6,000	30,000+
PharmEasy	Medicine delivery and healthcare services.	2,500	10,000+
Porter	Intra-city logistics and goods transportation.	500	200,000+
Licious	Meat and seafood delivery.	1,000	5,000+
Blinkit (formerly Grofers)	Quick commerce and grocery delivery.	2,000	20,000+
BYJU’S (WhiteHat Jr, etc.)	Online tutoring and education services.	4,000	10,000+
Upwork (India Operations)	Freelancing platform (IT, design, writing, etc.).	Not disclosed (global revenue $500 million).	1,000,000+
Fiverr (India Operations)	Freelancing platform (creative and digital services).	Not disclosed (global revenue $300 million).	500,000+
Taskmo	GIG work platform (on-demand tasks and staffing).	50	100,000+
Quikr	Local services and freelance jobs.	200	50,000+
Housejoy	Home services (cleaning, repairs, etc.).	100	10,000+

The GIG economy has witnessed remarkable growth in recent years. As shown in Table 2, it has expanded nearly 40-fold since 2014. Initially, its emergence was driven by factors already discussed earlier. In the following years, the boom in food delivery services, ride-hailing platforms, and, to a smaller extent, online shopping, further fuelled its expansion.

Table 2

Size of GIG Economy

Year	GIG Economy Size (USD Billion)	GIG Economy Size (INR Lakh Crore)
2014	~1.5–2	~ 0.9–1.2
2016	~3–4	~ 2–2.5
2018	~8–10	~ 5.5–7
2020	~12–14	~ 9–10
2022	~20–24	~ 15–18
2024 (Est.)	~35–50	~ 30–40

The COVID-19 pandemic acted as a major catalyst, sharply increasing demand for e-commerce services such as grocery delivery, prepared meals, and household items. Platforms like BigBasket, Grofers (now Blinkit), Instamart, and others capitalized on this shift, while major e-commerce players such as Amazon (promoted as “aapkiapani dukan”), Flipkart, and Snapdeal expanded their offerings to include a vast range of consumer goods. Rising unemployment in the manufacturing sector pushed many workers into GIG roles, often under any working conditions available. The introduction of “10-minute delivery” by many grocery and e-commerce companies illustrates this pressure—while convenient for consumers, it imposes high risks on delivery workers, who must navigate hazardous conditions to meet deadlines, a clear sign of job desperation.

Table 3 further reflects the sector’s rapid growth. The GIG economy’s share of India’s GDP rose from just 0.5–0.8% in 2014 to an estimated 2.5–3% in 2024. In terms of workforce size, the number of GIG workers jumped from 8–10 million in 2012 to 25–35 million in 2024. According to NITI Aayog projections, by 2030 the sector could account for 5% of GDP and employ around 50 million people—roughly 10–12% of the total non agri. workforce—potentially surpassing industries like textiles and logistics.

Table 3

2014–2016:	~0.5–0.8% of GDP	1.5–2% of non-farm workforce (~8–10 Mn GIG workers)
- 2020:	~1.2–1.5% of GDP	~4–5% (~15–20 Mn GIG workers)
- 2024 (Est.):	~2.5–3% of GDP (India’s GDP ~$4 Tn)	7–10% (~25–35 Mn GIG workers)

A sector-wise breakdown shows that blue-collar workers make up about 70% of the GIG workforce. This category includes ride-hailing and delivery workers (Zomato, Swiggy, Dunzo, Uber, Ola), e-commerce logistics staff (Amazon, Flipkart), and care/home service providers (Urban Company, Housejoy). These workers face the most severe exploitation: long working hours, low pay, and lack of benefits.

White-collar GIG workers, in contrast, comprise about 30% of the workforce and include freelancers in IT, consulting, creative services, and similar fields. They earn monthly incomes ranging from Rs. 50,000 to Rs. 2 lakh, enjoy greater job security, receive insurance, and require specialized skills such as coding or design. Blue-collar workers, on the other hand, typically earn only Rs. 20,000–Rs. 25,000 per month, lack job security, and are frequently subject to algorithmic deactivation. Their primary skill requirement is often limited to driving.

GIG: Good or Bad

The GIG economy has its staunch advocates, who attempt to justify it by highlighting perceived benefits for workers. Conversely, there are critics who, from the workers’ perspective, argue that it represents nothing more than a modern form of exploitation. Let us explore this further. Much of the earlier discussion already provides a foundation for understanding the reality of the situation.

Arguments in favour of GIG work

Supporters of the GIG economy cite several reasons in its favour. GIG workers are said to enjoy flexible work schedules, allowing them to decide when to work and when to take time off. This flexibility enables them to treat GIG work as a supplementary or secondary source of income. They can leave at any time, choose their clients or employers, and exercise greater control over their professional commitments.

Reality of GIG work

The GIG economy presents a range of serious problems for its workers. One fundamental issue lies in the very definition of a “worker” and the rights and benefits associated with it. GIG workers are excluded from statutory employer-provided benefits such as overtime pay, minimum wage protections, maternity and paternity leave, compensation for workplace injuries, ESI and EPF benefits, and the right to engage in collective bargaining. They fall entirely outside the scope of existing labour laws and norms.

As a result, they suffer from low earnings, social isolation, irregular and antisocial working hours, overwork, sleep deprivation, and exhaustion. A joint WHO–ILO study (2021) found that GIG work not only leads to poor health outcomes but has also contributed to rising worker mortality, as the pressure to work longer hours at irregular times takes a toll on both physical and mental health.

The oft-touted “flexibility” of GIG work is, in practice, a myth. To earn a sustainable income, workers must accept as much work as possible; refusing tasks leads to being deprioritized or even losing work altogether. In reality, “flexibility” means workers must remain available whenever the company requires, yet receive work only intermittently. They must instantly accept GIGs when they appear and then wait for the next one. For example, Ola drivers in India are penalized for rejecting pick-up requests.

The rise of 10–30 minute delivery services in e-grocery and food platforms has further intensified pressure. Workers in the vicinity of an order feel compelled to accept it to maintain their rating or protect the aggregator’s brand promise, even if it means riding in hazardous weather or driving recklessly. Ratings systems also increase vulnerability—workers can be penalized for issues beyond their control, as customers rate them directly and they are the only visible representatives of the company.

Such conditions disrupt sleep patterns, daily routines, and work-life balance. GIG workers are forced to constantly search for new jobs and be available at all hours, regardless of personal obligations, while facing intense competition. Those unable to secure work have no access to unemployment insurance.

Supporters argue that GIG work can be a supplementary source of income, enabling people to hold primary jobs while earning extra income in their free time. However, a PUDR survey (Sept–Nov 2021) revealed that for most workers, GIG work is their primary livelihood. Average monthly incomes are Rs. 25,000–30,000 for Ola/Uber drivers and Rs. 14,000–15,000 for Swiggy, Zomato, and Amazon delivery workers—before deducting expenses. Drivers must cover vehicle instalments or daily rentals (Rs. 500–600/day for cars, Rs. 100/day for e-scooters), plus fuel and maintenance, leaving much lower net earnings. In such circumstances, there is no real flexibility—only chronic insecurity. Payment is tied to completing specific tasks, with no guaranteed minimum wage.

The “freelancer” label is also misleading. GIG workers are classified as “independent contractors,” which denies them fundamental rights like minimum wage and health insurance. Contracts explicitly state that platforms are not employers—Uber, for example, declares its drivers are “not employees in any way.” Yet these companies control pay rates, working hours, and penalize refusals; Swiggy even imposes “black marks” for rejecting orders.

This structure has led to an increase in unpaid working hours. Workers may endure four hours of unpaid waiting time, 14-hour shifts, and complete job insecurity. Urban Company beauticians are forced to buy company-approved products and face harassment without effective recourse. Delivery riders risk accidents without any insurance cover. Companies often side with customers even when they are in the wrong—penalizing workers for infractions such as not wearing a helmet, even if the circumstances are beyond their control.

A survey by the Indian Federation of App-based Transport Workers (IFAT) and the International Transport Workers’ Federation (ITF) found that many drivers spend 16–20 hours a day at the wheel, leading to chronic ailments like backache, constipation, liver problems, waist pain, and neck pain. They have no access to accidental, health, or medical insurance.

The transient nature of GIG work also erodes long-term relationships between workers, clients, employers, and vendors, removing the benefits of trust, familiarity, and stable collaboration. Since relationships end as soon as the next GIG is complete, neither side invests in mutually beneficial arrangements.

The growth of GIG work has also affected full-time employees. Because GIG workers are cheaper to hire, companies increasingly replace regular employees, undermining long-term career prospects.

Government measures to address these concerns have been inadequate. While some social security provisions have been suggested, they stop short of recognizing GIG workers as regular employees or establishing an employer–employee relationship. GIG workers should be recognized as piece-rate workers and guaranteed minimum wages, an eight-hour workday, and other statutory benefits.

Why consumers shifted to GIG

The rapid rise of the GIG economy can be explained first from the customer’s point of view. Ride-hailing provides the clearest example. In the past, passengers had to wait by the roadside or travel to a taxi stand in search of a ride. Today, with just a few taps on a smart phone, a cab can be booked from home, and vehicles are readily available across most urban areas.

Traditional taxis often involved bargaining, and overcharging was a frequent complaint. App-based taxis, by contrast, display fares in advance, calculated algorithmically, and allow digital payments. They also provide GPS tracking, trip-sharing, and SOS features, which let families monitor a passenger’s journey in real time. These safety and accountability mechanisms did not exist in conventional taxis. A rating system has further improved service quality by making both drivers and passengers accountable. Added to this are promotions in the form of discounts, coupons, and cash back, which draw in customers and encourage loyalty.

A similar story unfolded with online delivery services. Consumers discovered the convenience of ordering groceries, meals, or household goods online and receiving them at their doorsteps. The COVID-19 pandemic accelerated this habit, as lockdowns forced millions to rely on such services. What began as a necessity soon turned into an expectation, creating lasting demand for app-based delivery.

From the driver’s perspective, however, the transition has been far less positive. Traditional taxi drivers usually owned their vehicles and retained the full fare. In the app-based model, companies deduct 20–30% commissions, while drivers bear the costs of fuel, insurance, maintenance, and loan repayments. In the early years, drivers earned relatively well due to subsidies and promotional schemes. Over time, however, incomes became unstable and steadily declined.

Traditional taxi drivers typically worked fixed hours with room for rest. App-based drivers, by contrast, are compelled to work 12–16 hours a day just to earn subsistence wages. Rejecting rides can lead to penalties or fewer bookings. Time off comes at the cost of lost opportunities. The rating system keeps drivers under constant pressure, with even minor mistakes reducing scores and jeopardizing future work. In disputes, companies usually side with customers.

Whereas traditional taxi driving could sustain families over the long term, the future of app-based driving is profoundly uncertain. There is no social security, no health insurance, and no pension. Workers are labeled “independent contractors,” but their hours, pay rates, and working conditions are tightly dictated by algorithms. The same logic extends to other blue-collar GIG work—food delivery, logistics, and home services—where precarious incomes and intensified pressure have become the norm.

Political Economy of GIG

From a Marxist political economy perspective, the GIG economy does not break with capitalism but represents its logical extension. It reshapes the ways in which surplus value is generated, capital is circulated, and labour is exploited.

A GIG itself can be seen as a unit of exploitation, where labour power is sold not for fixed hours but for discrete tasks. Workers—drivers, delivery agents, freelancers—carry out labour that creates value, while the platform extracts surplus through multiple channels: commissions charged to both workers and customers, advertisements within apps, and the appropriation of consumer data.

The GIG economy excels in generating absolute surplus value by extending the working day. With no guaranteed minimum wage, workers must often labour 12, 14, or 16 hours to secure even a subsistence income. Much of this includes unpaid waiting time, which nonetheless enables platforms to guarantee “on-demand” services to consumers. At the same time, platforms extract relative surplus value by intensifying labour through algorithmic control. Ratings, performance metrics, and schemes like “10-minute delivery” compel workers to accelerate their pace, often at the cost of safety and health.

The circulation of capital in this model further clarifies the dynamic. Platforms function as capitalists, investing in digital infrastructure, warehouses, and servers. What is distinctive, however, is that much of the fixed and constant capital—vehicles, bikes, and household tools—is provided by the workers themselves. This creates the illusion that they are petty capitalist “partners,” but in reality, these assets are deployed for their own exploitation. Services are sold to consumers, and the surplus flows back to the platform in the form of higher profits. By offloading constant capital costs onto workers, platforms secure exceptionally high profit rates while minimizing their own risk.

The system depends on the reserve army of labour—the mass of unemployed and underemployed workers. High unemployment ensures a steady supply of desperate workers willing to accept low-paying GIGs. If one worker rejects an order, the algorithm instantly reallocates it to another. This perpetual competition keeps wages depressed and weakens any possibility of collective resistance.

Exploitation is intensified through algorithmic management, the digital equivalent of the factory overseer. Algorithms dictate routes, timings, and earnings; discipline workers by downgrading or deactivating “low performers”; and obscure the figure of the boss. Because the “manager” appears as a neutral piece of code rather than a person, workers often internalize blame (“my rating is low”) instead of recognizing systemic exploitation.

Thus, we can say that the GIG economy thrives on a contradiction. For consumers, it represents convenience, transparency, and safety. For companies, it provides extraordinary profits with minimal investment and virtually no social obligations. For workers, however, it produces insecurity, intensified exploitation, and the erosion of hard-won labour rights.

Far from transcending capitalism, the GIG economy represents its digital-age evolution—a system where capital gains near-total freedom from responsibility toward labour, extracts surplus with ruthless efficiency, and conceals exploitation behind the sleek façade of a smart phone app.

Over the years, GIG workers have engaged in both spontaneous and organized protests across the country. However, what is urgently required is a sustained, large-scale, organized movement to address these systemic problems.