The Gig Economy in the Developing World
March 29, 2021
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by Stephen Kanyi

Once thought of as a refuge for the unemployed, the gig economy is rising fast in both developed and developing economies. Today, especially after the COVID phenomenon, freelancing is the employment method of choice especially for knowledge workers. Its flexibility and freedom is unmatched by the traditional 9-5 office routine. A research done by Payoneer found that up to 60% of workers prefer freelancing and have no interest in going back to the traditional office model.

For developing economies, the effect of the gig economy is unparalleled. Freelancing is opening doors that the mainstream economies in these nations are, for one reason or another, unable to provide. It comes as no surprise then that 5 of the top 10 countries most benefitting from freelancing, as indicated from Payoneer, are developing countries. This includes countries such as Brazil, India, Pakistan and Philippines. India is particularly impressive as up to 52% of its workforce are freelancers contributing more than $400 billion to the national GDP.

Youth Unemployment

The gig economy has been especially crucial in solving one of the biggest problems in developing economies today, youth unemployment. The Middle East, Sub-Saharan Africa and South East Asia have the highest global youth unemployment rates of approximately 31.05%. Freelancing has been crucial in solving this crisis as a report found out that up to 70% of those working in the gig economy are under the age of 35. Gig employees are also less concerned about education but instead value experience and delivery. This has benefited the youth in these countries most of whom lack the necessary education qualifications but are willing to put the work in.

A personal Story

After graduating from university in 2016 I found myself in the same situation that millions of youth graduating from campus each year in Kenya find themselves, unemployed with very few prospects to look forward to. Thankfully, I had already started freelancing during my third year in college on Odesk, which is today Upwork, and had set for myself a stable source of income that helped through campus.

I was however not sure whether I wanted to commit to freelancing as my full-time job. My classmates, who I had graduated with, were all scouring for job opportunities in Nairobi’s CBD and some, albeit a very few number, were even successful. After a call from a friend who had found a job I decided to test the waters and see if I could also join the mainstream job market.

My first attempt was an NGO that operated nationwide. After presenting my documents the secretary was quick to note that I had impressive grades but they couldn’t hire me because “I was overqualified and so they couldn’t afford my salary” which, come to think about it, I hadn’t considered at all. I just wanted a job, like my friends. I applied to various other firms and mostly got no replies at all. The ones that did reply were only kind to note they were glad that I applied to their companies and that they would call me when an opening came. I’m still waiting for those calls to this day.

Following the failed attempt at a ‘normal job’ I decided to set-up camp in my house and continue freelancing. But first, I needed to bolster my profile. So I applied to Andela to sharpen my coding skills. Upon completing a rigorous 6-month program I was able to secure several gigs that made me decide to never go back looking for an office job.

Sadly, my story is like millions of others in the wider African continent. However, in most cases after failing to secure employment, most opt to start their own businesses with the little cash they can gather. These are very small businesses that lack the capacity to grow. Most end up stuck with an income that can barely support them and their families.

Freelancing then has been a haven for the unemployed in developing economies. It presents opportunities that the mainstream economy simply cannot provide.

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