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Peru: digital platforms and labor conditions

January 11, 2022

Diego Alonso Aguilar  

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Within the framework of the project Future of Work in the Global South: Digital Labor, New Opportunities, and Challenges, we present the results of a qualitative study conducted by LIRNEasia between 2015 and 2017 to understand the experiences of independent online workers (freelancers) in Sri Lanka, India and Myanmar. In Sri Lanka, six focus group discussions were held at three population centers, resulting in a sample of 30 people. For India, an online survey to assess trends and perceptions related to online work on digital platforms was conducted, obtaining a sample of 1,976 people. Finally, for Myanmar, 102 digital workers were interviewed in towns such as Yangon and Mandalay. We first present the profile of freelancers, followed by the reasons for online freelancing, and then show the challenges these workers face. Lastly, we compare findings with those arising from a similar exercise conducted for Peru.  

 Among the main reasons that freelancers opt for online independent work are flexible hours, teleworking, alternate employment, inclusivity and income. Overall, many online workers emphasize that flexible hours are an advantage for different groups of people. For example, students can tailor work based on their class schedules, which does not allow for full-time or traditional “9-5” work. Something similar happens with housewives, since in this case “free time” is used to perform online work, which fosters a balance between the person’s work and family environment. This example shows that online work has been an important instrument for the inclusion of people, especially for those who faced obstacles to enter the traditional workforce, such as married women, often with children. 

 

By doing this type of work online, students were able to generate their own money and pay for their academic expenses. Housewives, on the other hand, were able to generate independent income for their personal and family expenses and gain some financial independence. Note that, even for those people who perform traditional “9-5” work, online independent work is a way to earn additional income since they can do it at the end of their working hours. For full-time online freelancers, this job is preferrable to the traditional one not only for flexible schedules and inclusion, but because it gives them the opportunity to “be their own boss” and manage their career based on their goals. They even noted that they consider this work more stimulating and creative than the traditional one. 

 Another predominant benefit of freelancing is the opportunity to work anywhere; all they need is an internet connection. This makes job opportunities across borders possible, giving a price advantage to workers from countries such as India, Sri Lanka and Myanmar compared to workers in the Global North. U$S5 per hour is considered a pretty good wage in parts of Asia-Pacific. An additional benefit of remote work is the reduction in travel time compared to face-to-face work and the stress it generates, in some cases, due to infrastructure problems. 

 However, not everything implies benefits. These workers still face challenges because they fall outside the conventional labor regulatory framework. Online freelancers are paid by the gig. This means that their income is inherently irregular because their ability to earn depends on their ability to get jobs. Online freelancers do not have formal contracts with their employers or other employment benefits, giving rise to a power imbalance between the client and the freelancer. While some platforms offer these workers tools to present some disagreements with the client, there is little they can do in the face of a withholding or delay in payment. Other difficulties involve social acceptance, connectivity and access to online work, difficulties accessing financial services, and a low awareness of online work. 

 As mentioned above, an internet connection is essential to this work. However, the vast majority of freelancers reported infrastructure problems, such as power outages. In addition, they must assume the cost of financial penalties when receiving bank transfers from abroad or when using digital payment platforms.  

 Companies that are part of the so-called platform economy, collaborative economy, or online gig economy represent a fairly new business model in the Global South. This is not only the case in Asia, but also in Latin America, where we found similarities with the findings described above. For example, a qualitative study conducted in Peru this year found that workers of the various digital platforms offering taxi and delivery services have a subordinate relationship with the companies and their algorithms. Additionally, the work of drivers on these service platforms is equally or more precarious than online freelance work in the three countries analyzed. While most jobs on digital platforms show evidence of a lack of access to non-monetary labor benefits or other benefits guaranteed with a formal job, taxi and delivery services face continuous exposure to accidents, aggressions, diseases and discriminatory experiences for which companies do not assume any responsibility or expense (González, 2021). Consequently, regardless of the increased opportunities to access flexible work, there is a growing precariousness for these workers.  

 

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