The Phenomenon of The On-demand Economy

The on-demand economy according to scientists and economists is “the On-Demand Economy is defined as the economic activity created by digital marketplaces that fulfill consumer demand via immediate access to and convenient provisioning of goods and services.” In short, this kind of economic operation was created and modified to meet consumers’ demand instantly through websites which users could access and purchase products or services, therefore, productivity can be fortified.

Gig economy (can be inter-substitutable for on-demand economy), according to Investopedia: “is where temporary, flexible jobs are commonplace and companies tend toward hiring independent contractors and freelancers instead of full-time employees, A gig economy undermines the traditional economy of full-time workers who rarely change positions and instead focus on a lifetime career”. It means companies now recruit freelance or casual employees (outsourcing) to get the work done instead of employing full-time workers like in the past.

Sharing economy, also known as ‘collaborative consumption’ or ‘sharing economy’, is “a peer-to-peer-based activity of obtaining, giving, or sharing the access to goods and services, coordinated through community-based online services”.

Taking Uber, Airbnb, Grab, Lazada, Amazon, Shopee for instance. This kind of companies all outsource from other places to do their business. They employ people as services like Uber as peer-to-peer ridesharing, people riding their car and picking up customers so people are actually services. Other examples are Shopee, Amazon, Airbnb. The companies are running their business through websites, providing consumers with online choices for accommodations, products, goods and other services but they don’t own any of those products. Anyone who wants to sell their products or services can be their staff and they’re flexible with their time when participating in this kind of online working for the companies.

The ‘gig economy’ can be exploitative due to some cases such as the following. First, it’s exploitative when the employees’ laws are destructed. For instance, the workers are not under the protection of the law since all of their jobs are signed on short-term contracts or to no contract at all. Furthermore, they have not received the insurance since the companies do not have to pay, unlike the full-time employees working in the traditional business models. Second, it might ruin the traditional business structure and erode the foundation of the “employer-employee” relationship. Third, this digital and internet-based economy is unfairly exploiting and using comparatively low-salary employees for profits and advantages due to the classification of staff.