KUALA LUMPUR (Dec 29): Malaysia’s gig economy has continued its upward trajectory in 2024, with the number of own-account workers, including gig workers, surpassing three million as of September.

The growth reflects the increasing acceptance and reliance of gig work as a viable source of income, the flexibility it offers and the expanding digital economy.

It has also brought increased calls for better protection, as many remain outside the coverage of labour laws.

The International Labour Organisation (ILO) has also noted the inclusion of gig workers in the category of own-account workers, reflecting the broader definition and recognition of gig work in the labour market.

According to the Labour Force Survey Report for the third quarter (3Q) of 2024, the number of own-account workers had increased to 3.09 million during the quarter from 2.93 million in 1Q2023.

Speaking to Bernama in an interview recently, Monash University Malaysia’s Department of Econometrics and Business Statistics senior lecturer Dr Nur Syazwani Mazlan said the gig economy’s expansion is a positive indicator of economic dynamism and the potential for further growth in the coming years.

Measures to address challenges
However, despite the encouraging growth, the gig economy faces several challenges.

According to human resource technology aggregator, Qwork Malaysia, many gig workers still lack essential labour protections under labour laws, such as minimum wage, working hour limits and paid leave.

Given the market saturation and evolving legislative requirements, agile strategies are needed to maintain growth in the sector.

In response to these challenges, the Malaysian government is in the process of introducing measures to support gig workers, including the proposed Gig Workers’ Economy Bill and the establishment of the Malaysian Gig Economy Commission (SEGiM) under the Prime Minister’s Department.

Qwork chief executive officer Muna Munirah commended the government’s proactive stance, saying the establishment of SEGiM and upcoming legislation would help ensure a more sustainable and inclusive gig economy.

At the same time, Grab Malaysia also welcomed the government’s decision to defer the tabling of the Gig Workers’ Economy Bill, believing that this would allow for more comprehensive consultations with stakeholders, including platform companies, gig workers, academics and industry experts.

“We believe that an inclusive and phased approach will ensure the diverse needs of the gig economy are addressed while minimising potential challenges such as difficulties in policy adoption, inefficiencies in implementation and compliance, higher entry barriers for gig workers, disruptions to businesses, and increased costs for consumers,” it said.

Raising social security, upgrading skills
To further enhance the gig economy, Nur Syazwani suggested that the government expand social security schemes, such as Socso and the Employees Provident Fund (EPF), to cover more gig workers.

She also recommended additional training programmes focusing on digital skills and financial literacy to help gig workers improve their employability and manage their finances better.

Additionally, she proposed the development of a clear regulatory framework to define the rights and responsibilities of gig workers and platforms, as well as easier access to financial services such as micro-loans and tailored insurance.

Outlook for 2025
The outlook for Malaysia’s gig economy remains positive, given that it is resilient and adaptable, supported by technological advancements and the demand for flexible services, said Malaysian eHailing Association (GEM) chief activist Jose Rizal.

However, he stressed the importance of systemic reforms to balance workers’ rights with sector growth, including the introduction of the Gig Workers’ Economy Bill and flexible social protections.

Qwork Malaysia highlighted emerging sectors like online tutoring and digital marketing, which, along with increasing technological integration, are expected to fuel the gig economy’s growth further.

Nur Syazwani said that as businesses continue to rely on digital solutions, demand for freelance roles in areas like content creation and information technology support is expected to rise.

“Overall, while the gig economy in Malaysia is set for continued growth, addressing challenges such as job security, income stability and market saturation will be crucial for its sustainability.

“With the right policies in place, the gig economy has the potential to significantly contribute to Malaysia’s growth while offering inclusive employment opportunities,” she said.