The gig economy in Ethiopia is still in its infancy, yet it has become a vital source of income for millions of workers who operate outside the formal employment sector. However, as this sector expands, there is a pressing need for policies specifically designed to protect gig workers, many of whom lack formal contracts and legal protections.
Gig workers in Ethiopia typically engage in short-term tasks that can be completed within hours or days. Common roles include cleaning services, plumbing repairs, electrical work, and childcare. Unfortunately, these workers often operate in a legal gray area, with many performing their jobs without any formal employment terms or protections. A recent study highlighted that domestic workers, such as housemaids providing part-time cleaning or cooking services, often work “in the shadows,” without any domestic laws governing their employment.
In response to these challenges, a panel discussion titled “Gig Economy in Ethiopia: Opportunities, Challenges, Ways Forward” was held to explore how to create dignified and fulfilling work opportunities for the country’s youth. This event was part of the Mesirat Program, which aims to reshape Ethiopia’s gig economy through a youth-centric approach. The discussion emphasized the importance of establishing Gig and Professional Marketplaces (GPMs) across the nation.
Experts at the event underscored the urgent need for protective policies that also facilitate growth within the gig economy. They addressed key issues such as taxation, worker protection, and labor law strategies. According to last year’s Mesirat policy digest research, only 17% of independent contractors possess a license with tax liability, indicating a significant compliance gap. For the remaining 83% of contractors, platforms withhold 30% of their income, highlighting their responsibility to manage tax obligations on behalf of gig workers.
The panel also discussed the potential benefits of implementing regulatory sandboxes tailored for gig platforms to thrive. Bernard, one of the experts present, advocated for such measures to encourage innovation and growth within the sector.
Menna Tafesse, Director of the Mesirat Program, emphasized Ethiopia’s potential to lead in developing its gig economy using homegrown resources. “Ethiopia is positioned to lead with homegrown economic resources,” he stated. “Creating an enabling environment can disrupt and empower the gig economy.”
The Mesirat Program is a five-year initiative aimed at creating opportunities for one million highly skilled workers by establishing and nurturing 100 GPMs across the country. Co-created by the Mastercard Foundation and Gebeya Inc., along with a consortium of partners, the program focuses on four key components: recruitment, vetting, upskilling, and gig matching.
As part of its mission to enable one million young people to secure dignified work while upskilling an additional two million individuals, the program collaborates with various energetic and competent partners.
The call for protective policies comes at a critical time as Ethiopia seeks to harness the potential of its gig economy while ensuring that workers are treated fairly and have access to essential services. By prioritizing these efforts, Ethiopia can create a more inclusive economic landscape that benefits both workers and the broader economy as it continues to develop.
