What does ride-hailing reveal about digital work in Nigeria?

In recent years, ride-hailing services have become an integral part of daily life, facilitating commuting, creating jobs, and fostering economic expansion.

The rise of ride-hailing services like Bolt amongst others has changed transportation in Nigeria, providing unprecedented ease and convenience in commuting and is unprecedented in the transportation industry whilst driving growth and economic progress.

According to Statista Market Insights, the ride-hailing market in Nigeria is anticipated to generate revenue of $264.00m by the end of 2024. This sector is expected to exhibit an annual growth rate (CAGR 2024-2029) of 12.56 percent, leading to a projected market size of $477.10m by 2029.

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Despite challenges posed by poor infrastructure and security concerns, ride-hailing services in Nigeria continue to grow due to high demand for affordable and convenient transportation options. Beyond the convenience of hailing a ride with a few taps on a smartphone, these services offer a compelling glimpse into the broader landscape of digitally-mediated work in Nigeria. The ride-hailing industry not only transforms mobility but also highlights the potentials, challenges, and future directions of digital work in the country.

Empowering the workforce

One of the most notable impacts of ride-hailing in Nigeria is the empowerment of the workforce. For many Nigerians, becoming a driver for a ride-hailing service offers a viable source of income, particularly in a job market that is often marked by high unemployment rates and limited formal employment opportunities. This digital platform provides an entry point into the gig economy, allowing individuals to leverage technology to earn a living.

The flexibility inherent in ride-hailing work is another significant advantage. Drivers can set their schedules, choosing when and how long to work. This flexibility is particularly beneficial in a country where many people juggle multiple responsibilities, from family obligations to other part-time jobs or entrepreneurial ventures. By offering a flexible work option, ride-hailing services accommodate the diverse needs of Nigeria’s workforce.

Challenges and opportunities

While the rise of ride-hailing also brings to light several challenges associated with digitally-mediated work such as the benefits of health insurance, pensions, or paid leave, some ride-hailing players are already offering support to drivers in this regard. Recently, Bolt announced its commitment to ensure all rides are insured and credit access to drivers. These initiatives are steps in the right direction.

Furthermore, the earnings of ride-hailing drivers can be inconsistent and subject to fluctuations in demand, fuel prices, and maintenance costs. The competitive nature of the industry can sometimes bite the profitability of this work. For digital work to be sustainable, there needs to be a collective effort to address these economic vulnerabilities and ensure fair compensation for gig workers.

Despite these challenges, ride-hailing highlights the significant potential for digital platforms to drive economic inclusion. With the right policies and support systems in place, digital work can provide meaningful opportunities for a broader segment of the population. Investing in digital literacy and infrastructure will be crucial to maximize the benefits of this evolving work landscape.

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A glimpse into the future

The success of ride-hailing services in Nigeria serves as a case study for the potential of digitally-mediated work across various sectors. As technology continues to advance, similar digital platforms could transform other industries, from logistics and delivery services to professional freelancing and beyond. The key will be to harness the benefits of digital work while mitigating the associated risks.

Governments and policymakers have a critical role to play in this transformation. By creating regulatory frameworks that protect gig workers’ rights and promote fair competition, they can ensure that the growth of digital work benefits everyone. Additionally, fostering partnerships between the private sector, government, and civil society can help develop innovative solutions to the challenges faced by digital workers.

In conclusion, ride-hailing in Nigeria reveals both the promise and the pitfalls of digitally-mediated work. It underscores the need for a balanced approach that leverages technology to create opportunities while safeguarding workers’ welfare. As Nigeria continues to navigate the digital age, the lessons learned from the ride-hailing industry will be invaluable in shaping the future of work in the country.

Ademola Balogun, writes from Lagos