Labor platforms – new digital businesses that connect consumers with workers to provide a service – offer many benefits, but challenges to decent work remain. This column argues that there needs to be a balance between harnessing short-term economic opportunities and ensuring the long-term upward mobility of workers. In particular, it is vital to create a skills system based on collaboration; one which evolves with the constantly shifting challenges of local and global labor markets.
Recent disruptions to the global economy are changing how we live and work. Before Covid-19, advances in information and communications technologies (ICT) paved the way for digital platforms, facilitating the exchange of goods and services in the digital space and providing people with new economic opportunities. Now, the pandemic has upended employment trends and reshaped consumption habits. It is accelerating government initiatives for digital transformation and the widespread adoption of digital solutions in the workplace.
Among the different types of digital platforms, labor platforms are particularly attractive to many people in developing countries since they offer work opportunities that may not be available in their local labor market. They also offer flexibility, which may help women balance the needs of care work and market work, and allow people to earn while also pursuing an education or leisure.
Despite these advantages, challenges remain, and the precariousness of work endures. Platform workers are not employees, so neither platforms nor firms provide social protection or career development opportunities. Indeed, platforms could be viewed as new vehicles that deliver age-old inequalities. There are work platforms that cross borders – those that are transacted and delivered online, typically known as ‘crowdwork’. On these platforms national labor laws to ensure decent work no longer apply.
How then can economies harness the benefits of crowdwork? There is no single best answer, but it is desirable to strike a balance between harnessing short-term economic opportunities and ensuring the long-term upward mobility of workers.
Given that national labor laws that provide protection and support for workers can no longer be enforced, state-led initiatives are critical, especially in training and skills development. Platform workers need to demonstrate a level of knowledge and expertise; the absence of which will likely preclude them from securing jobs. This is especially true for ‘macrotasks’, a type of crowdwork that requires specialized skills. In addition, platform workers need to retool and upskill to remain competitive and sustain their work.
The importance of training and skill developments is underscored by lessons from the 2020 Online Survey of Market and Non-market Work in the Philippines, conducted by the Philippine Institute for Development Studies. A study analyzing the data from this survey finds first, that respondents’ current platform engagement is similar to their past platform work; and second, that their past experience on platforms is an important determinant of whether they will be currently engaged in platform work. These suggest that the right endowments are key to securing and sustaining work on a platform.
The importance of training and skills development is also highlighted in a study using the Online Labor Index. For example, one in four crowdworkers from the Philippines and one in ten crowdworkers from Bangladesh, India, Indonesia, and Pakistan are involved in clerical and data services. But while 59%, 45%, and 52% of crowdworkers from India, Pakistan, and Vietnam, respectively, are engaged in jobs related to software and development technology, only around 14% of crowdworkers from the Philippines are doing tasks in this sector.
This does not bode well given evidence that crowdwork’s sectoral experience from the pandemic varies: jobs in creative/multimedia and sales/marketing support have been severely reduced, while those in technology/software development have demonstrated resilience.
Despite the fluidity of work, the requisite skills of different work settings and business models are likely to be the same. Regardless of the working arrangement, there remains a need for both hard skills (including numeracy, literacy, writing, internet literacy, and basic ICT skills) and soft skills (such as time management, and interpersonal and communications skills).
This suggests that focusing on specific skills that only coincide with current trends is not a good strategy. Instead, emphasis on the creation of systems to develop skills that are useful in any working arrangement is a more sensible approach. Collaboration among academia, industry, workers’ associations and unions, public and private providers, and government agencies is key to identifying current skills and training needs.
It is also essential to identify additional training programs as the needs of the local and global labor markets unfold. In addition, it is vital to ensure the continuity of the system and to facilitate the sharing of information, tools, and resources as the system evolves with changes in labor markets at both local and international levels.
One successful skills system is the SkillsFuture of Singapore, which provides a comprehensive mapping of resources on education, careers, and training to help citizens make more informed labor market choices. The Singaporean government also provides credits that can be used to pursue lifelong learning and skills development.
Other economies can learn from SkillsFuture and adapt its principles to their own institutional and governance contexts. This will help to prepare a resilient workforce that is ready to face the challenges of a constantly evolving world of work.