Digital divides in informal work

Published on 7 March 2017

Next week sees the inaugural Digital Development Summit 2017, and following last week’s blog on 3 analogue factors that affect the future of tech and work for women, here is the next in the series, by Practical Action’s Jonathan Casey, drawing on recent research on technology and the future of work.

New, innovative digital technologies have the potential to transform the wellbeing and work opportunities of informal workers. Digital technologies are increasingly pervasive in all work sectors, including informal work, and technology upgrading is often considered a crucial means to improve the decency of work, productivity, and scale. Yet the role and importance of digital technologies in informal work opportunities and livelihoods is little understood or explored.

Understanding disruption

As the world moves ever-closer to fully digitising systems, including the means of transactions, and access to basic services, there is a need to understand the differentiated impacts of technology disruption on those who work in the fastest-growing sector – the urban informal sector. Through a recent research project, Technology and the Future of Work, supported by the Rockefeller Foundation, Practical Action and WIEGO explored the disruptive impact of technologies on over 1,000 informal workers in 5 urban areas, and the factors influencing informal workers’ decision-making in technology investments.

Geographical digital divides

The impacts of digital technologies, in particular mobile phones, were found to be starkly different among the cities studied. In Nairobi, Kenya, the cultural and economic shift towards digitised services and systems is helping to drive technology change among many informal workers. Over 80 per cent of respondents from Nairobi indicated that they used mobile phones in their work, including soap vendors, water vendors, and waste workers.

Yet in Dhaka, Bangladesh, just a handful of the 300 informal waste workers and street vendors – who tended to largely be recent migrants from rural areas – owned a phone, with none indicating their use in their work activities. Few recognised any need or value in their use, and many reported that they struggled to afford a single meal each day, let alone invest in new technologies. Yet all around them, other workers, higher up the value chain and in more formalised working conditions, were utilising phones for organisation, communication, and market information. The digital divide was therefore amplifying the inequalities already being faced by informal workers in Dhaka.

In Ahmedabad, India, home-based garment workers were harnessing the power of digital technologies to positively respond to the disruption they faced in their industry, from the increased centralised mechanisation of garment production. The informal garment workers, all female, were using digital services to market their goods online, and face-to-face using their phones to show images of their goods. By marketing them as handmade traditional goods, the women were able to diversify their customer base.

What drives these differences?

The availability of affordable phones and mobile operator services, coupled with innovative software platforms which utilise the SMS functionality of the basic phones owned and used by many poor informal workers, has created an enabling environment for mobile phones to emerge as a technology which is changing the nature of work in Nairobi. Mobile phones are used not only for organising and communicating with suppliers, and indeed customers, but also crucially for digital money payments through the M-Pesa system, which has made mobile technologies a vital tool for improving work opportunities in Nairobi, particularly for women. There is a social acceptance of the technology, and a well-established group of local innovators developing pioneering phone-based support systems for all manner of needs.

In Ahmedabad, the increased access to both secure housing and to electricity supply, has enabled workers to incrementally invest in new technologies such as upgrading from basic phones to smart phones, and purchasing more advanced sewing machinery. The women are largely based in one place, involved primarily in one work sector, and are well organised through groups such as SEWA. They felt more comfortable to invest in and innovate with digital technologies within this environment, which offered them security through mutual support systems.

In Dhaka, many informal workers are transient across a variety of work sectors and different types of informal work – often moving between waste work and street vending – and thus felt less invested in specific work activities or sectors, or had no secure means to store multiple ‘sets’ of technologies for different types of work, nor in organising around a specific work opportunity. Their lack of social capital and networks in the city limited their vision of how connected digital devices could help them in their work endeavours.

A way forward for closing digital divides

Digital technologies herald great opportunities for positive economic disruption for informal workers, connecting them to new work opportunities, creating efficiencies in their work, and improving their means of organisation. But this must be coupled by the socialisation of the technology, trust in the technology systems, and supportive regulations.

We should focus more on closing access gaps, and activities which build the skills and knowledge of users on the plethora of uses of digital technologies, and less so on developing ever more apps for phones that the majority of informal workers do not own.

We must also recognise the importance of local language content. A lack of local language content has been cited as a key barrier to increased internet use in Africa, and only a small number of the workers we engaged with were literate, and fewer still had the opportunity to learn English.

Yet the business potential to reach billions of new customers through a focus on solutions which will serve the unconnected half of the developing world, and software innovations which leverage 2G networks and devices, offers promise. At upcoming tech events, such as the Digital Development Summit 2017, how can development agencies, social enterprises, and digital developers work together to better understand and react to the precarious work situations facing millions of informal urban workers? Can a focus on supporting systems and an enabling environment really be central to the work of technology organisations, or will it always fall to civil society to advocate for wider change?

Jonathan Casey is Policy Adviser: Technology Innovation and Gender Equality at Practical Action.

The views expressed in this opinion piece are those of the author/s and do not necessarily reflect the views or policies of IDS.


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