Actuaries Institute: Gig economy grows nine-fold

Actuaries Institute: Gig economy grows nine-fold | Insurance Business

Actuaries Institute: Gig economy grows nine-fold

The Actuaries Institute has revealed that Australia’s gig economy grew nine-fold between 2015 and 2019. However, it has warned that gig economy workers could face long-term financial disadvantage.

The Actuaries Institute’s latest research highlighted the rapid growth in consumer spending on digital platforms such as Uber, Deliveroo, and Airtasker, which underwent a nine-fold increase between 2015 and 2019. It found that the gig economy in the country grew between 2015 and 2019 to $6.3 billion, with a 32% gain in 2019.

However, the paper warned that workers could face long-term financial disadvantage due to their lack of access to employer-funded superannuation and other basic entitlements.

“The rapid rise of the gig economy has brought both opportunities and risks for workers, raising some important policy issues, particularly with regard to long-term financial security,” said Actuaries Institute chief executive Elayne Grace.

Grace pointed out that most gig workers have only minimal superannuation contributions and lower insurance coverage, which increases the prospect of greater reliance on public safety nets, including the age pension.

“With the economy evolving rapidly, particularly under the influence of the COVID-19 pandemic, it is increasingly important that we better understand the risks to workers and how they might impact on future public policy,” she continued.

Under Australian labour laws, food delivery riders are considered “independent contractors.” Therefore, companies are not obligated to pay workers’ compensation in the event of injury or death.

Actuaries Institute president Hoa Bui said the paper highlighted the Institute’s commitment to identifying and analysing key issues that will have an ongoing impact on economic and social policy.

“While the paper clearly outlines the opportunities and risks presented by the gig economy, there is a need for further research to develop policy changes that ensure the Australian workforce is adequately supported, while not reducing the benefits of economic activity that the gig economy brings,” Bui said.