Retrenchment Downsizing To Push More Into Gig Economy


Currently, 26% of the workforce in the gig economy freelances and the number is expected to grow.PETALING JAYA: The gig economy is set to grow tremendously in 2020 in the wake of higher unemployment rates
According to AmBank Research, as retrenchment exercises begin to pick up the pace, Malaysia’s unemployment rate could rise from 3.3% to between 3.4% and 3.6% this year
According to the research paper, the first 10 months of 2019 saw a decreasing number of job vacancies with an average of 83,700 jobs. An estimated 37,260 people were laid off last year
The rising unemployment rate is likely to push people into the gig economy, which includes the e-hailing sector, with companies such as Grab and MyCar. Other popular gig platforms include Lazada, Carousell, Airbnb, Dego Ride, Kaodim and Foodpanda
More than 60,000 drivers nationwide registered to work for e-hailing services last year with the number set to steadily increase. Foodpanda has some 13,000 riders while GrabFood accounts for 10,000 just in the Klang Valley
Over the past five years, the gig economy has grown parallel to digitalisation in the country. Across the world, digitalisation has changed the face of work and business as conventional businesses turn to technology as a means to survive and grow
The high demand from tech-savvy millennials has also contributed to the creation of opportunities in the gig economy
The gig economy is attractive for many reasons. More and more people are unwilling to stay in an office for hours each day
The gig economy also usually pays swiftly in cash. There is no need to wait a whole month
Some may work a gig while hunting for a full-time job while others seek to supplement their income and have greater control over their time
Last year, the gig economy was identified as a new source of economic growth after it recorded an increase of 31% in 2017, surpassing conventional workforce growth
Currently, 26% of the workforce freelances and the number is expected to grow with retrenchment and downsizing exercises forecast to continue this year. - FMT

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