Gig economy workers – the ones left behind

TWO years into the Covid-19 outbreak has shown that the pandemic affected more than just health and the global economy. A long period is needed for global health and economy to recover and return to normal.

Based on observation, it is clear that Covid-19 has become one of the events that precipitated social inequality. Those with underlying health conditions are at high risk. World Health Organization (WHO) research shows that patients with hypertension who contract the disease face an 8.4% fatality rate. Patients with cardiovascular disease face a higher risk of fatality, at 13.2%.

A study by Khazanah Research Institute shows that 20.4% of low-income households live with diabetes, whereas 38.3% live with high blood pressure; compared to high-income households, where the figures are only at 14.8% and 27.1% respectively. It stands to reason that low-income households are more likely to experience severe Covid-19 symptoms. Furthermore, people with lower household income have limited access to testing and healthcare, further exacerbating their already precarious condition.

Covid-19 spreads through physical interactions, which is why the government implemented the movement control order (MCO). Citizens were ordered to stay home to prevent the spread of Covid-19, with the exception of essential services workers. Those considered essential are medical front-liners and gig workers who are primarily in the delivery service.

When the lockdown was enforced, low-income households were worried about reduced income and the possibility of losing their livelihoods. However, the gig economy, which includes p-hailing services, has opened up an avenue of income. P-hailing services are defined as services involving the delivery of food and parcels by way of motorcycles. This is significant as the demand for services such as p-hailing services has surged dramatically. Hence, those from the lower-income group have had to risk their lives for work.

Data from the Malaysia Digital Economy Corporation (MDEC) show that by the end of 2020, there were a total of 700,000 workers in the gig economy. However, only two out of 10 gig economy jobs are online-based services such as programmer jobs, the remainder are location-based services like p-hailing services.

Those in the p-hailing service industry are vulnerable in two ways. For one, they are exposed to the risk of contracting Covid-19. Secondly, they are exposed to work hazards, such as road accidents. The situation is much worse considering that they are not afforded the same protection as full-time employees. A case in point is during the MCO in 2020, 91 reported accident cases involved p-hailing delivery riders.

Therefore, most self-employed individuals, such as gig economy workers, do not have the same protection as formal sector workers. Gig economy workers are at higher risk of contracting Covid-19, and are more vulnerable to the economic problems posed by the pandemic. The government should enact policies that offer protection to them.

Institut Masa Depan Malaysia (Masa) proposes that the government start an initial strategy to protect gig economy workers by making registration with the Social Security protection scheme (Socso) a mandatory requirement. The government would be subsidizing half of the cost of subscribing to Socso. An allocation of RM533.5 million a year will be required for a limited period to encourage gig economy workers to opt in for Socso. Further, gig economy workers should also organise a union to use collective bargaining as a means to negotiate their needs.

A modification of the existing system regulating gig economy workers is needed. The policies introduced should be inclusive and should focus on a need-based approach. This is outlined in the first objective of the Shared Prosperity Vision 2030. – July 13, 2021.

*Amirul Hamza bin Abdullah is a Research Analyst with Institut Masa Depan Malaysia (MASA).

Date: 13 July 2021
Source: The Malaysian Insight –
Images from: Unsplash –

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