Building resilience for the gig worker

Two individuals stand next to each other and smile for the camera.
November 22, 2020

In 2018, the global gig economy generated $204 billion in gross volume, with transportation‑based services, such as ride‑sharing, taking the share of the cake at 58%. This economy was projected to grow by a 17% compound annual growth rate (CAGR) leading to a gross value of approximately $455 billion by 2023, due to factors such as evolving societal attitudes around peer to peer sharing and rising digitization rates in emerging markets.

However 2020 may have led to a significant depletion to the growth of the gig economy sector due to COVID‑19. The pandemic resulted in societal and regulatory restrictions being enforced in how business operations are conducted. In Africa, the COVID‑19 pandemic has exposed the absence of safety nets to cushion gig workers against a crisis. Gig workers in many African countries are already reporting that their savings — on which they can live for four to six weeks to buy basic necessities — are depleting. Their families are drawing closer to malnutrition, starvation, longer‑term exclusion from the labor market, and other socioeconomic issues that could far outlast the pandemic. Additionally, governments have struggled to develop a safety net of the same strength for this cohort of the workforce as compared to the social safety protections in place for people in traditional employment models.

“We have seen many formal jobs shrinking across the continent. It’s important for the government, private sectors, and many institutions to catch up and prepare for this future of work as gig work is going to be the new normal,” said Sharmi Surianarain, Chief Impact Officer for the Harambee Youth Employment Accelerator.

On a positive note, many gig economy businesses have proven to be valuable network enablers during this time by ferrying food around locked‑down areas and responding to exceptional levels of demand. However, the pandemic is also acutely highlighting the precarious nature of the gig economy worker‑company relationship.

“The impact of COVID‑19 on gig work has been crucial in highlighting the precariousness and potential of the gig economy as well as underscoring the lack of preparedness we have in the system, economies and institutions,” said Surianarain.

Most companies have had to make decisions on how to manage human capital during the COVID‑19 pandemic, such as how to deliver on their responsibilities to employees and customers as well as shareholders. In the gig sector, some platforms implemented new measures to ensure that gig workers were able to perform their work amidst the pandemic. Some of these measures include setting up a new health insurance policy in response to the outbreak, like in the case of Sendy, and the provision of protective equipment to workers. Additionally, e‑commerce platforms like Sky Garden quickly adapted processes to reduce transmission risk, such as no‑contact delivery.

How Mercy Corps is building resilience

Backed by years of experience supporting various technology initiatives in the digital economy, Mercy Corps' Youth Impact Labs program hosted a virtual 2‑day learning event dubbed Employment Rewired to provide insights on how digital gig workers have been affected, particularly in the face of COVID‑19. The event featured a panel session to discuss ways in which the digital economy has acted as a cushion for gig workers and built their resilience. Key panelists included Ezana Raswork, the CEO of Eziti Information Services, an Information and Communications Technology (ICT) firm that manages Taskmoby, a service matching platform, Sharmi Surianarain, the Chief Impact Officer of Harambee Youth Employment Accelerator and Michelle Hassan, the Kenya Country Manager of Catalyst Fund managed by BFA Global.

Through Youth Impact Labs, Mercy Corps played an instrumental role in supporting innovative gig partners through a mix of grant support and technical assistance. This support helped the program’s partners adapt their business models or service offerings to remain sustainable and take advantage of emerging opportunities during the pandemic. In addition, Youth Impact Labs provided unconditional cash transfer support to gig workers for pending expenses and, for some, starting small businesses to support their families amid the crisis.

Youth Impact Labs supported Taskmoby, a gig platform in Ethiopia, in pivoting to a new disinfection service aimed at business‑to‑business and business‑to‑government clients. This support enabled a share of the gig workers already utilizing the platform to continue generating revenue. Additionally, for partners like e‑logistics platform GetBoda and e‑commerce site Herdy, Youth Impact Labs was instrumental in the provision of working capital to assist the firms in purchasing protective equipment for their workers and partners. Additionally, we supported these platforms in building their inventory to meet increasing demand for their products.

“One of our key learnings during the pandemic has been the ability of the platform to onboard, train and deploy support to thousands of workers efficiently,” said Ezana Raswork, Founder and CEO of Taskmoby.