Egypt joins the Fairwork project

Rüdiger Stehn / fllick (https://www.flickr.com/photos/rstehn/33345146555/)

The Fairwork team in Egypt is led by Nagla Rizk, Professor of Economics and Founding Director of the Access to Knowledge for Development Center (A2K4D) at the School of Business of the American University in Cairo (AUC). Nadine Weheba, Associate Director at A2K4D and Khadiga Hassan, Researcher at A2K4D, will work together with Rizk to adapt, implement and disseminate research on the platform economy in Egypt.  Desk research, including a preliminary identification of the platforms that will be rated, commenced in January 2021.

The first gig economy platform, Uber, entered the Egyptian market in 2014 against a challenging economic landscape, particularly as it pertains to work. With a population of over 100 million, 60 percent of whom are under 30 years of age, Egypt has witnessed high rates of unemployment among its youth (30 percent), those with advanced education (22 percent) and women (21 percent). More than half of those who are employed do not have health insurance or pensions and are working without a contract. Additionally, more than half the country’s workforce belong to the informal sector; they earn their living on precarious basis, have no access to social security and operate outside state-sanctioned laws and parameters, especially labor laws.

Egypt’s otherwise agile informal sector was itself dealt a severe blow by the pandemic and was unable to shoulder the rest of the economy this time. Meanwhile, Egypt’s continued reliance on external sources of finance (oil, remittances, the Suez Canal or tourism) has meant little economic diversification and limited growth in available job opportunities. Unemployment has been structural and sticky, and has now become also cyclical as a result of the pandemic.

Egypt’s gig economy workers have been confined in this context. The shutdown and the economic shrinkage due to the pandemic have meant that many gig workers have lost their source of livelihood, with no compensation. Indeed, they faced the difficult dilemma, like other informal workers, between the dire need to put food on the table and the risk of falling sick by leaving their homes to work.

In an attempt to adjust,  gig economy platforms responded to the pandemic by announcing a series of safety precautions for both users and workers, such as requiring facemasks and sanitization. While such measures are by no means sufficient to guarantee worker livelihoods, they may have encouraged some continuation of demand for their services. Indeed, Rizk’s (2016) study shows that, in a context of worsening economic conditions in Egypt, the platform economy has provided life support for some, and hence warrants a nuanced examination.

This also pertains to women in the gig economy. In other research, Rizk et al (2018) offered a gendered perspective of ride sharing, studying women who were breaking social taboos by working as drivers, a phenomenon that is unprecedented in Egypt.  The global Fairwork principles will be highly pertinent to assess gender bias in the platform economy. The outcome of the assessment will also be a useful tool to encourage more dignified opprotunities for work in the platform economy for women. This is especially relevant given that Rizk et al (2018) found that women identify the flexibility of work offered by such platforms as a key motivator for choosing this work as it enables them to fulfill their domestic duties while also earning an income. This is even more relevant today in light  of the pandemic as women bear the brunt of housework, child and elder family care as well as home schooling.

Today, Egypt’s gig economy is expanding beyond ride sharing, paving the way for other digital platform models that meet a dire need for work, but that also necessitate further regulation. In 2018, the ‘Ride Sharing Act’ was drafted in response to protests led by the traditional ‘white’ taxi drivers . The Act represents the first attempt to regulate the platform economy in Egypt.  It does, however, add an additional burden to app-based drivers, as they are now required to pay EGP 2000 (equivalent to $125 USD) annually in licensing fees and are subject to taxes 25% higher than their white taxi driver counterparts.

The Fairwork principles and research will help bring the interests of workers in the gig economy to the forefront when it comes to policy making.  With budding local platform economy initiatives and digitization gaining more attention from policy makers, the scene is developing at a relatively early stage, fueled by the 100 percent mobile telephone penetration in the country. This is a key opportunity to use the Fairwork principles to raise awareness, engage with stakeholders and encourage platforms to work towards providing sustainable and equitable opportunities for workers.