Economic Survey says digital economy to transcend $1 trillion by 2025, impact gig economy

India's digital economy is expected to surpass $1 trillion by 2025, according to the Economic Survey 2024-25.

The projection, based on data from the ministry of electronics and information technology, is set to significantly impact the employment sector, especially the gig economy, and overcome challenges in the job market.

The digital economy, as defined by the Organisation for Economic Co-operation and Development (OECD), refers to “all economic activity reliant on, or significantly enhanced by the use of digital inputs, including digital technologies, infrastructure, digital services, and data," the survey said. The sector refers to all producers and consumers, including the government, utilising digital inputs in economic activities.

The growing digital economy has created more employment opportunities, especially for the freelancing workforce. As a result, the gig economy is also set to grow to 235 million workers by FY30, comprising 4.1 per cent of the total workforce.

"The digital economy has significantly broadened job opportunities, encompassing roles from delivery personnel, cab drivers, and beauty professionals to software engineers and data analysts," the survey said. "Hyperlocal service platforms have revolutionised the job landscape in the transportation, food delivery, and home services industries. These platforms have created flexible employment options by leveraging technology while transforming traditional service sectors into digitally driven ecosystems."

Female workforce

The digital economy also offers a unique opportunity to bridge the gender gap in employment by overcoming the challenges in the traditional labour market, especially by giving access to remote working.

The female workforce, which was previously subjected to unequal access to education, limited job opportunities, cultural bias, mobility and time restrictions, and concerns about workplace safety, is now thriving, with opportunities opening for women in developing countries with increased financial independence and empowerment.

The survey also highlighted the rising female labour force participation rate (FLFPR) over the past seven years – from 23.3% in FY18 to 41.7% in FY24.