The Plight of Freelancers in Pakistan

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The world has grown smaller and smaller since the advent of modern information technology. The creation and development of the world wide web has had an intense impact on humanity and how people live across the globe. One of the biggest impact of increased connectivity across the globe has been the connection between the demand and supply of certain skills across the board. 

Up until a decade ago, the majority of the world’s working class had to live close to where they worked. This was due to the fact that the working class emerged from the peasant class that existed in the feudal system that had preceded the industrial revolution. Before that, people lived in the pastures they worked at. Most of the world’s manpower was involved directly in the growing of crops and rearing of cattle for consumption. 

This has been the case for most of society. However, with the industrial revolution came technology that shifted the workers from the field to the factory. Now, since the 20th century, there has been another shift where factory workers are now office workers. Automation has made the menial jobs that had been of utter import in the old days obsolete. The work-place became cubicles and offices and most people began working from there. This meant that people had to live near their work-places inorder to commute to and from there and this led to the emergence of cities that were centered around commercial areas meant for work. 

People lived in suburbs or in the city itself according to their means and the closer to your work you were, the more expensive the place you lived became. This is basic demand and supply. However, post the internet and the opportunities it provides, the job marketplace changed quite a bit. Gone were the days when you had to be close to your workplace and a lot of the people working today do so on computers utilizing internet and communication tools that made the idea of being at the workplace itself obsolete. 

Even then, a lot of the jobs available to people are still on-site and in-house which means that people still had to commute to and from work despite being not needed to do so. You can get an internet connection anywhere on the globe and most devices needed for work have become more and more portable and lightweight overtime. This came to the fore during the global coronavirus pandemic and consequential lockdowns that basically forced employers to have their employees work from home. 

The Validity of Remote Work

As much as people like to say that remote-work is inefficient or not worth it the research proves otherwise:

Several studies over the past few months show productivity while working remotely from home is better than working in an office setting. On average, those who work from home spend 10 minutes less a day being unproductive, work one more day a week, and are 47% more productive.

In anycase, there came with this the rising phenomenon of freelancing. Basically, the 9 to 5 life has largely been replaced with shorter contracts with objective-based work rather than punching in and punching out regardless of productivity. This gave rise to the freelancing industry in developing nations that catered to companies and individuals in the developed countries all over the globe. This is largely due to the fact that living costs in the former are lower than those of the latter and thus labour costs are much lower in these countries. And so, much like the automobile industry and the textiles industry, the software and software products industry shifted from the likes of the USA and Europe and Australia to regions like India and Pakistan. 

The Freelance Industry of Paksitan

Particularly in Pakistan there has been a lot of youngsters that have been benefitting from platforms like upwork and fiver to provide video-editing, ghost-writing, and editing services to clients from different countries where these things are in a higher demand. 

In 2020, Pakistan became known as the eighth fastest growing nation with regards to the freelance industry. This, according to payoneer, a US based financial services provider that often works to allow clients in the first world to pay people in Pakistan. 

In 2019, a Payoneer index reported that Pakistan has the fourth largest freelancer community in the world.

“Not long ago, youngsters’ dream career idea revolved around a chair, a desk, some documents to sign, some letters to draft and draw salary,” said Dr. Irfan Jafar, Dean Computer Science, Superior University Lahore. “However, things have changed for good. Youngsters are now powerful enough to leave that orbit to master their destiny.”

Jafar said Pakistan has witnessed an exponential surge in freelancing during last few years, mostly during the COVID-19 epidemic. “Freelancing was making inroads fast among the Pakistani youth.”

Pakistan is among the top five countries in the world when it comes to freelancing and generated a significant calculated amount of $0.5 billion entirely from freelancing. Pakistan is ranked as the 4th most popular country for freelancing in the Online Labor Index published in 2017 by Oxford Internet Institute (OII) and is consistently ranked among the top destinations for Internet Communications and Technology (ICT) outsourcing because of the exponential growth of the IT sector.

The freelancing industry in Pakistan is rapidly progressing. The national community of freelancers has generated $216.788 million by exporting their services from July to December during the fiscal year 2021-22, which is almost a 16.74 percent rise from last year’s earnings for the same period. This data was recently released by the Ministry of Information Technology and Telecommunication (IT&T)

Plight of Freelancer’s in Pakistan

Keeping all of this in mind, it has become abundantly clear that the government is very likely to try and shut this down some way or the other. The first inkling of this when they blocked the entrance of Paypal into the market to aid freelancers in getting money from their clients abroad. Now there are indications that there will be heavy taxation on the earning of the freelance industry in Pakistan. 

The Federal Government is considering jacking up taxes on freelancers and content creators earning from social media platforms like YouTube and TikTok. According to the details, the Federal Government is considering imposing 30% tax on freelancers and content creators in the upcoming budget for the fiscal year FY2022-23.