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00:00 Welcome viewers, this is Rishabh Bhatnagar and you're watching Startup Street. Today we have a
00:04 very different kind of a guest, we have been not interviewing a founder or an investor. We are with
00:10 Dr. Burnali Bhandari, she is a professor at the National Council for Applied Economic Research.
00:16 Why she's here is because she was the project lead on a very very interesting study
00:22 on gig workers and their socio-economic status currently in India. Welcome Dr. Bhandari to BQ Prime.
00:30 Thank you Rishabh, thank you Rishabh for inviting me to your show.
00:32 Right, so Dr. Bhandari can you start us off by explaining a little bit about the context of the
00:41 study that you've done on gig workers, a little bit more about the sample size, when this survey
00:46 happened, who has sponsored it, yeah if you could just start us off. Sure, so this work is actually
00:55 about platform workers, I am going to carefully use the word platform workers and specifically
01:00 about food delivery platform workers. So I think ETIO 2022 published a report last year
01:09 asking many questions about platform workers. I think this is a contribution towards that
01:16 to answer to many policy questions and about who are the platform workers, what are their
01:23 background, socio-economic backgrounds like, what are their earnings, what are their work
01:26 conditions like, are we actually making a move towards formalization as suggested by many
01:35 commentators, are we, you know, how much income, how much is when the fuel prices went up,
01:43 was it challenging for them and how were they able to actually meet their expenditures. So it's
01:49 essentially about the work conditions, employment and the incomes. It's also the larger macro
01:56 questions, can it actually help, can it actually create employment for you. So in an endeavor to
02:05 answer all these questions, we sort of, we surveyed 924 food delivery platform workers on
02:14 one particular company in the April, in the time period April to May 2022. So it was last,
02:22 when the survey was done last year and it was a telephonic survey. Partly we were recovering
02:28 from the pandemic and partly also because food delivery platform workers are always on the move,
02:32 so it was easier to get them on the telephone and talk to them and the uniqueness of the survey
02:40 is that it is not just concentrated in tier one cities, it is concentrated, it is covered all over
02:45 India. It covers 28 cities representing all the tier one cities, tier two cities and tier three
02:52 cities from all the major regions, north, south, east and west. So that's the basic background of
03:00 the work. Sorry Rishabh. Right, right, very important context setting there by you Dr. Bhandari.
03:07 Another disclaimer that I'd like to add is that the study was sponsored by Process, I believe,
03:13 and Process is a lead investor in Swiggy which is a very large employer of platform workers.
03:20 So that's just one pointer there. Dr. Bhandari, I went through the report as well. I would suggest
03:26 our viewers to also go through it. It's very interesting, available on the NCAER website now.
03:33 Dr. Bhandari, incomes had not uniformly increased for all long shift workers compared to their
03:39 previous jobs is I think one of the top takeaways from this. Can you elaborate a bit on that?
03:43 Sure, I think the first, just so that everybody knows the terminology, the idea is that there are
03:52 long shift workers and short shift workers. Long shift workers are workers who are working on the
03:57 platform, on a platform for 11 hours, on 11-hour slots for six days in a week. And there are
04:05 short shift workers who are working on five, for five hours in a day or on weekends or on special
04:13 days. So we distinguish between that and in the sample itself we actually include both workers
04:19 who are on the platform and workers who may have left the platform. So we distinguish by saying
04:23 that active and inactive workers. And also we distinguish, so and if you look at the long shift,
04:31 the distribution of long shift and short shift, it's about 50-50 or 60-40. That's the distribution
04:37 that we come to. The interesting thing to remember is that, the interesting thing to remember is
04:44 about incomes that you asked. So we find that long shift workers, when we asked them, we compared
04:50 them, we asked workers about their previous jobs and what they were doing current and of course
04:58 their delivery platform job. Because you have to compare apples to apples and oranges to oranges.
05:03 So when we compared those income, how much they were earning before and how much they are earning
05:09 now, we find that the incomes had either increased or stayed the same for 65% of the workers. Here
05:16 we are talking about gross income. And then for others, for the remaining workers, the incomes
05:24 have decreased compared to their previous job. So that was gross income. So yes, there is,
05:29 it's a mixed evidence. So that's the key result that we are talking about, about incomes.
05:39 Yes, Rishabh. So there's another finding there about a lot of them actually being highly skilled
05:47 in terms of being college graduates as well. Can you expand on that?
05:51 Yeah. So what we found is that 90% of the workers were actually above class 10.
05:58 And within that, of course, the average education level or median level of education was class 12.
06:06 And about 40% of the workers were college graduates. And or 38%. But essentially,
06:16 the idea is that a large proportion of the workers are college graduates. And
06:22 they were on the platform, they were on the platform, working and they came from a variety
06:30 of backgrounds. It's not like there was, of course, a lot of significant quarter of them
06:36 were also students who were working on the platform. But they also came from backgrounds
06:40 like driver, salesperson, shopkeeper, it was the number of people coming from a variety of
06:48 backgrounds was quite humongous. All sales workers, if they find it easier to switch to
06:54 food delivery platform. So we do find that people come from a variety of backgrounds, but
06:59 they're relatively highly, relatively speaking, or highly educated.
07:06 Right. So those that are college graduates, do they come into these platforms for additional
07:18 income? Or is that their sole source of income? No, that also varied a lot. That also varied a
07:26 lot. There were some who were there for sole wage earners were primary wage earners. Again,
07:31 it was it wasn't like they were a mixture of that. And essentially, it 67% of the people came to the
07:39 join the platform because of higher income. That's 70% joined because of higher income. And
07:46 quite a few people leave also because of higher incomes. The entry and exit is quite high as a
07:51 higher income what is driving their thing. And people join as per their convenience. So there
08:00 is no big distinguished between workers who are working long shift and short shift. And we don't
08:06 find that there are any major differences in education as such education levels that would
08:13 stand out. But it's the income is a motivating factor with very little restrictions to entry.
08:21 It becomes a social welfare net or a safety option if you're doing nothing. There were some people
08:31 who said they were doing nothing before this and we asked them like, were you studying? We finished
08:39 work study and we were doing nothing for two, three years. And then we joined the platform.
08:44 So it is a it offers a livelihood way of getting into the world of work. And for some of the
08:52 students, it was a stepping stone for a world of work. So they got some experience. It's not that
08:57 there was no experience. There was GPS, they learned how to operate the smartphone, they
09:02 learned how to operate GPS, they learned English speaking skills, customer handling skills.
09:07 And of course, so this helps them to at least get into the world of work, if not anything else.
09:14 Dr. Bhandari, there's also this observation about real incomes that have gone down
09:20 over the past few years. The report says that it's become harder to achieve targets over time,
09:27 due to more traffic and competition. So could you expand a bit on how incomes have actually gone down
09:33 over the past few years? So when you adjust for inflation, and we use this consumer price index
09:40 for adjusting it, we find that real incomes have gone down over time. And there were two things.
09:46 One is of course, higher fuel prices, or higher inflation, because nominal incomes were going up.
09:53 The other reason was they also faced increased competition from a larger number of people
10:00 entering the food delivery platform sector. Again, contextualizing is very important. Remember, we're
10:05 just doing this out of the pandemic, April, May of 2022, we're just coming out of the pandemic.
10:11 So there were a lot of surplus labor force at that point of time. And another thing they
10:18 found is they found it harder to achieve incentives, and the traffic was actually increasing.
10:25 So combination of that resulted, were acting as a constraint for workers to earn much more.
10:34 The challenges are harder in tier two and tier three cities in a way, because the networks
10:39 are weaker in there. Because it's a smaller town, tier one cities are thicker network.
10:46 Right. Very interesting points there, Dr. Mandari. Last couple of questions that I have on this.
10:54 To workers, are we moving towards formalization then? Are these jobs actually
11:01 impacting lives positively for these workers?
11:05 The formalization question is very interesting. So we went with the NCUS type of definition,
11:15 where it sort of falters. Because here, the definition of informality
11:23 is requires that you should be working at a particular enterprise. But here, there's no
11:29 particular place where they're working, right. So they have to actually move around. So I think we
11:33 need an update on the definition of informality. The second is that when we look at the existing
11:40 characteristics of informality, we find that, like, if you look at three, four characteristics,
11:49 is paid leave, whether you get paid leave, whether you get some social employer provided benefits,
11:54 whether you have written contracts, so on and so forth, and pensions, we find that there are two
12:00 favorable factors. That is now everyone has a written contract, at least the contractors on the
12:05 app, which they can say yes or no to. And a large portion of the proportion of the risk workers said
12:11 that they were aware of the terms and conditions. So there's a written contract. And almost 100%
12:19 of accident insurance. But the problem is, they also get their accident insurance.
12:27 In their previous jobs, they all of them did not have medical insurance. So that's a definite move.
12:35 On the other factors, they don't get any paid leave, and which they used to in the other
12:40 other jobs, previous jobs. And some of them also get, they get no pensions, which some of them used
12:47 to get in their previous jobs. So on the net, net, it does move the needle on formalization.
12:52 So I think that question is definitely is there, it moves the needle on formalization.
12:57 But there's we have much more to go before we can call them formalized formal workers.
13:02 So is it better off or not? It depends. It totally depends. But I think it's a it's a
13:11 it's an option for workers. Instead of sitting at home and not doing anything, I think it's a
13:19 better way to be employed, because at least it gives them a job. It even if you're not the
13:23 primary wage worker, you can actually help support your families, you can help you earn
13:28 pocket money. And we heard several positive stories there that it helped and when the time comes,
13:34 people move out. The challenges that when people have limited opportunities outside,
13:39 we found that people who are more educated, we're more likely to deal. So the challenges,
13:44 challenges are when people have little options outside and we have to figure out ways,
13:49 what those workers with little options outside and how can we help them to either move out or
13:54 either move out and get another job or move up horizontally or vertically or and also,
14:01 of course, provide social security support. Right, so so in its current shape, can we say that
14:08 this sort of employment is sort of filling the gap between actual employment and unemployment
14:14 and not very meaningfully? But yeah, like you said, it is moving the needle towards formalization.
14:20 I think it's a food delivery platform, workers stop gap, good stop gap arrangement. As I said,
14:26 as I've said in the report also that instead of this endlessly waiting for the thing,
14:33 this is a more productive way of waiting for workers. It gives them a sense of achievement.
14:40 It might not be always be possible to see that in tier one cities, but tier two, tier three cities,
14:45 when we were creating local jobs, we saw that, you know, that that sense of achievement that
14:52 they're doing something, you know, and they also felt happy that they have no boss.
14:56 They're not answerable to anybody. They're more flexible. So there is a positive story there.
15:02 Well, of course, the work condition, I'm not taking away from the fact that
15:06 work conditions can definitely be improved. Right. Lastly, document.
15:13 Now, we just want to say as an economist, there's always a but right on one hand and another hand.
15:18 Right? Yeah, that's a perfect segue to my next question, which is as an economist,
15:24 and as a professor, who probably keenly follows policy in this in this regard,
15:31 I think there's a lot of scope for regulation. Still, in the sector, we even at a state level,
15:37 or at a central level, there's very less legislation that we see here. What's your take on that?
15:43 And I want to talk, I don't know what the other platform sectors because all platform sectors,
15:50 sectors are heterogeneous, but for the food delivery platform, I think one needs to be
15:54 careful about very tight regulation, because that regulation can then limit entry into the jobs.
16:00 Also, and here, when you can easy option for people, while you find your next job,
16:06 it's an easy option to earn money. I think meaning there's a night, there's a trade off between
16:13 tightening regular regulation too much and, you know, getting people getting people a job. I'm
16:19 not saying it's a perfect job. It's a job that gets food on the table. It helps to support your
16:25 families. So that's a trade off. That's a fine line that the public policy has to think about,
16:32 or walking that fine line to balance these trade offs. That is the important thing. And I think
16:39 also we need to think about is, is providing social security. And I think that's much for
16:44 debate. I mean, the way at least I have framed it in my mind is, like typical is what schemes,
16:50 what's what, what social security scheme should we cover them with? How do we finance them?
16:55 And then, you know, to whom to finance them? If so many people are leaving,
17:01 then how do we track those people who are leaving? Do we, for how long do we cover them?
17:06 Because there is this easy entry and exit. I'm not saying there are no entry barriers.
17:12 There are some entry barriers, but the average duration of a platform worker in that particular
17:17 platform at that point of time was 14 months. So it's about you stay for one and a half years and
17:23 then you move on. So in that particular scenario, those are the policy questions that come across.
17:29 And I know how we have to think about ways, how to address those gap, address them to make the
17:35 workers at least their work conditions better, I think, and much better. So that's how we have
17:43 to think about it. And I think is, I'm not saying that nothing is fraught with challenges,
17:48 but I'm saying is why we design new systems. I think at least if we could get them on the
17:57 existing systems, it might provide even though even then we might have to change some regulations,
18:02 but if we could potentially get them onto existing schemes, we could at least help them to cover the
18:08 immediate needs while we design a more robust social welfare system for platform workers.
18:13 Right. Very, very interesting points there, Dr. Bhandari. Thank you so much
18:19 for the study and for sharing your insights. Viewers, this was Dr.
18:24 Gurnali Bhandari from the NCEAR. Thanks for watching.
18:34 [END]
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