Temporary employment, the new economy


  • Education
  • Sunday, 22 Dec 2019

Many educated youths are taking up e-hailing, delivery and other "gigs" as a temporary or side job to earn extra income,

IT was 2am and raining when Afif Ali pulled up on his motorcycle at the condominium lobby in Petaling Jaya.

He shook water droplets off his raincoat and calls his customer.

“Hi Miss, this is Grabfood here. Can you come down to the lobby to collect the order?”

Minutes later, a woman appears and apologises to Afif.

“She handed me a RM10 tip and apologised that I had to ride in the rain. I couldn’t believe it.

“I think I just froze because she kept telling me to take the money. It was unexpected. As a delivery man, this is my job. The gesture made me really happy.”

The 19-year-old who speaks good English is saving up to continue his studies.

He says it can be difficult at times, especially during rush hour when the traffic is horrendous.

“But this job allows me flexible time,” says Afif.

A recent Bernama survey involving e-hailing drivers, freelancers as well as contract workers, showed that the majority of gig economy participants are young, educated, and struggling to find a stable job.

Afif is just one example from the many youngsters who are part of the gig economy.

Gig economy explained

Simply put, the gig economy is a labour market characterised by the prevalence of short-term contracts or freelance work done by individuals; driven by the digital environment and the prevalence of apps that instantly communicate information and opportunities for work.

This growing segment of the economy is synonymous with freelancing, which has positive and negative aspects to it, and offers both opportunities and uncertainties.

It is mostly carried out by the younger generation who are attuned to the digital environment.

University student Carol Lee became a gig economy worker to seek additional income.

The alarm clock on Lee’s mobile phone rings at 7.35am and after five rounds of “snoozes”, she dashes to her laptop and starts her daily task of compiling news articles to submit to a foreign media monitoring agency before 9am Malaysian time.

This has been the mass communication student’s routine for the past two-and-a half-years as she tries to make more pocket money through the freelancing gig she found through a job-seeking platform.

“I also juggle freelancing jobs like proof reading, writing reports, and translation projects from this agency to earn some money to pay part of my tuition fees and keep up with daily expenses,” says Lee whose family is financially strapped.

The Kuala Lumpur native who has been juggling part time jobs and studying, admits it’s not easy, but she’s determined.

“Some challenges include missing lectures and having to complete assignments - including my final year project - in a timely manner.

“But I’ll keep providing my services to the agency as long as they need it - if possible, even when I have a full-time job. Having additional income is always a good thing especially in this economy,” says Lee.

On Oct 17, Youth and Sports Minister Syed Saddiq Syed Abdul Rahman expressed concern that Malaysia was falling behind in terms of embracing the gig economy which has become a major boost for the digital economy sector in countries like Indonesia and Thailand, The Star reported.

Future of workforce

A PricewaterhouseCoopers (PwC) study showed that by next year, the gig economy is expected to be worth some US$63bil (RM263bil) globally.

The rise of the segment comprising wholly of impromptu jobs, gigs, or contract assignments, will be a challenge for human capital and resources management, the auditing giant noted.

PWC reported that some 46% of human resource professionals worldwide expect that by 2020, up to 20% of the workforce will comprise contract workers on short-term or freelance assignments.

Universiti Kebangsaan Malaysia vice-chancellor Prof Dr Mohd Hamdi Abd Shukor is supportive of students working in the gig economy while studying.

“By being their own boss, students would develop positive attitudes like being responsible and discipline,” he says.

Noting that the gig economy will affect the overall economy positively, especially from the perspective of companies being more efficient and agile in doing business, Prof Hamdi says he isn’t worried that working in the gig economy would cause students to lose interest in studying.

“The gig economy might be something new in Malaysia but developed nations have been doing it for many years.

“According to our statistics, students from our university quitting due to their involvement in the gig economy, is almost unheard of.”

Prof Hamdi hopes to see more students getting involved in the gig economy.

“It will be the new norm of doing business in the near future, especially for the micro industry and SMEs,” he says.

University of Cyberjaya Business and Technology Faculty dean Prof Dr K. Mudiarasan agrees that it is a positive move for youngsters to start in the gig economy at an early stage.

He said students could develop work skills such as money consciousness and management, customer service and time management.

“Almost all industrial sectors crave talents with relevant skills the moment they join the workforce. Working while studying enables this.

“Transferable skills in the gig economy is enhanced and strengthened. This helps in knowledge accumulation,” says Prof Mudiarasan, an active researcher who has over 50 publications under his belt.

Noting that there are many students engaged in the gig economy already, he says its evolution will take the country by storm just like how the latest technologies were embraced by Malaysian youths. So, diligent management of gig economic activities is pivotal.

The gig economy, says Prof Mudiarasan, has positive and negative effects to traditional economy.

“Money supply opportunity is enhanced and entrepreneurial activities also establishes innovative downstream.

“However, the negative side of it is the economic stability could also be fluid with less sustainability.”

Shamsuddin says many youngsters opt to involve themselves in the gig economy because it provides a short term solution for economic woes and they have the freedom to decide when to work and the level of income they intend to achieve.Shamsuddin says many youngsters opt to involve themselves in the gig economy because it provides a short term solution for economic woes and they have the freedom to decide when to work and the level of income they intend to achieve.

Should a student opt to quit studying and work full time in the gig economy, Prof Mudiarasan says they can always return to studying due to the education system today that enables lifelong education.

Malaysian Employers Federation (MEF) executive director Datuk Shamsuddin Bardan believes that the gig economy is “here to stay” and will grow bigger in Malaysia.

“People are losing their jobs in the traditional economy while the new entrants into the labour market are not able to get suitable employment.

“The gig economy is filling up the void that exists in the current traditional economy in the sense that if an individual is retrenched or does not get a job, the youth can always turn to the gig economy to earn an income,” he says.

Hence, there is a need to regulate the gig economy by putting in place some protection measures to ensure the well-being of gig workers - many of whom are young - for now as well as for their future.

But, to regulate this segment of the economy does not mean to micromanage it with lots of rules, he says.

“The authorities ought to facilitate the growth of the gig economy rather than constrain it by imposing bureaucratic requirements and other restrictions.

“Take e-hailing services for example. There were about half-a-million people providing the service before the requirement to have a license, social contribution and vehicle registration kicked in. Now there are only about 100,000 of them.”

If the government continues to impose too many rules, it will dampen the gig economy’s spirit of entrepreneurship and eventually kill off the industry, he feels.

This means less working opportunities for youths in the gig economy and the shrinking traditional economy.

Guidelines, says Shamsuddin, on settling disputes effectively between platform providers and people involved in the system should be placed, rather than leaving it to the civil courts to settle as that can be a costly and lengthy process.

He adds that the government should not interfere with platform providers’ method of running their companies.

Surviving the gig economy

Shamsuddin says many youngsters opt to involve themselves in the gig economy because it provides a short term solution to economic woes and they have the freedom to decide when to work and the level of income they want to achieve.

“If they seek a higher income, then they can opt to take up two or three additional positions within the gig economy or work around the clock.”

He stresses that financial literacy plays a huge role for youth if they want to survive in the gig economy.

“Youths in the gig economy must learn how to manage finances well, otherwise they might be running at a loss.

“For example, an e-hailing driver should maintain the car - which is a business asset - well to make it roadworthy for a longer time. So at the end of the day, there will be good financial returns to your investment,” he advises.

Meanwhile, the existence of gig economy workers also brings about a chance for the traditional economy to become more innovative and evolve.

However, there is grave concern about gig work that may not appear viable as a longer term source of income.

Based on data by the Employees Provident Fund (EPF), the growing gig economy and an ageing population are expected to cause a decline in the percentage of workers contributing to the fund.

“The biggest concern is whether the gig economy workers are providing for their twilight and rainy days.

There is no mandatory requirement for them to contribute to old age funds like the EPF.

“While there are some schemes that have voluntary contributions, they are purely based on the discretion of the people themselves whether or not to enrol,” Shamsuddin says, adding that social security is another concern.

In a recent Parliament session, Prime Minister Tun Dr Mahathir Mohamad identifies the gig economy as a new source of growth.

This is after data from World Bank surfaced, putting Malaysia’s gig economy as rising to as much as 26% of total economic growth.

The government, says Dr Mahathir, realises the implications of gig economic work as well as the need to safeguard worker rights.

He says the government has carried out initiatives to leverage on the gig economy and will in the 12th Malaysia Plan 2021-2025, focus on making sure it is sustainable and inclusive.

“More importantly, we have to ensure that we safeguard the interests and welfare of the workers and employers to focus on the gig economy,” he says, as those in the gig economy run the risk of being mistreated, exploited or disadvantaged by employers.

Shamsuddin begs to differ.

“It is a good move to safeguard their interests and welfare. However, I do not agree that the workers are being exploited by the platform providers.

“It is a free market. You are welcomed to join or quit at anytime,” he points out.

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