Fifth of Chinese Workers Are in Gig Economy as Pay, Independence Prove a Draw, Study Finds
Guo Jinhui
DATE:  Sep 15 2023
/ SOURCE:  Yicai
Fifth of Chinese Workers Are in Gig Economy as Pay, Independence Prove a Draw, Study Finds Fifth of Chinese Workers Are in Gig Economy as Pay, Independence Prove a Draw, Study Finds

(Yicai) Sept. 15 -- Around one-fifth of Chinese employees are gig workers as the country's quickly expanding digital economy prompts graduates to seek jobs that promise a higher level of autonomy and pay well, according to a study jointly released by a university think tank and a recruiting platform.

Modern information networks and communication technologies have driven a new pattern of flexible employment which is characterized by a relatively flexible employment relationship, a high degree of autonomy, and a lower entry barrier, according to a report recently released by Jinan University's Institute for Economic and Social Research, as well as Zhaopin.

By the end of 2021, China had about 200 million flexible employees, including takeout drivers, express delivery guys, ride-hailing drivers, and live-streamers, as the digital economy is widening to make up a larger share of gross domestic product, according to data from the statistics bureau.

Despite the vagueness of the concept, more workers are rapidly expected to join the trend of flexible employment in the digital economy era, Feng Shuaizhang, director of the IESR, told Yicai. In particular, such novel type of employment based on online platforms that have robust supply and demand has become an important part of China’s labor market, Feng added.

Zero-hour contracts offer higher pay but fewer benefits than traditional jobs, Feng said. Women, young people, people with little work experience, and well-educated people are more likely to seek flexible employment, the director added.

Most flexible workers are on-demand delivery staff as their share made up almost 70 percent of all in the first quarter, according to the report. The second-largest category is live-streamers with a portion of 18 percent. Based on industry, transportation, logistics, and warehousing was the biggest employer in this regard whereas culture, media, entertainment, and sports was No. 2.

The biggest group of people with traditional contracts have an average monthly salary of CNY6,001 to CNY8,000 (USD834 to USD1,112), accounting for almost 25 percent of the total, per the report. In comparison, flexible workers most commonly earn from CNY10,001 to CNY15,000 (USD1,378 to USD2,085) per month as this group makes up over 30 percent of flexible labor.

However, flexible employees need to save up. Employers cover around 65 percent of full-time workers' social security payments while for flexible workers the coverage declined to 19 percent in the first quarter. Moreover, the new types of contracts impact other benefits as many flexible workers cannot enjoy labor security and public services designed for people with full-time contracts.

An increasingly large portion of highly educated people choose to work independently as a new trend of overqualified flexible workers is emerging, per the report. Undergraduates make up almost 46 percent of all job seekers for flexible contracts and graduates with a Master's degree account for 6 percent of the total. Meanwhile, among job seekers looking for traditional contracts, undergraduates account for 43 percent of the total, and holders of Master's degree have a share of 5 percent.

China’s digital economy expanded to CNY50.2 trillion (USD6.94 trillion) in 2022 from CNY27.2 trillion in 2017, per an annual research report from the China Academy of Information and Communications Technology. Almost 42 percent of China's GDP was generated by the digital economy in 2022, up from nearly 33 percent five years prior.

Editors: Tang Shihua, Emmi Laine

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Keywords:   Flexible Employment,Digital Economy,Industry Survey,Research Report