Southeast Europe’s online labour market is becoming increasingly attractive to those with a less sophisticated skillset. The negative aspect of such a development is that these professions are paid less, and thus the total market value – measured by total generated income – is lower. On the positive side, however, is a convergence of (average) earnings between countries and between men and women
The region’s gig workers market is now stagnating, following strong expansion recorded over previous years. The leading global freelance platforms in Southeast Europe, measured by number of registered gig workers, are currently Upwork, Freelancer and Guru, where the latest measurement registered 104,988 freelancers across the region’s nine countries. This is shown by the latest report of the Public Policy Research Centre (CENTER), a Belgradebased think tank covering changes to the online labour market in the region. Upwork is the most influential global platform in the region – representing the leading platform in seven of the nine observed countries (Serbia, Bosnia-Herzegovina, North Macedonia, Montenegro, Albania, Croatia and Bulgaria).
Upwork added almost 3,000 new freelancers over the previous six months, far exceeding any employer in the region’s real economy. Upwork now has an almost 43 per cent market share, while Freelancer has fallen to a 25 per cent share and Guru represents the second dominant player on the platform market, with 32.3%.
In order for the comparison in the development of gig market to be as accurate as possible, and to counterbalance the difference in country size, the relative number of gig workers is compared to the size of the country i.e., the number of inhabitants. North Macedonia continues to lead the way, with 249 gig workers per 100,000 inhabitants, or 87 more than Serbia, which comes second with 162 gig workers. The fact is that North Macedonia represents a “hotspot” economy for gig work – with the number of gig workers comparatively almost ten times higher than in the lowest ranking Hungary, which has only 25 gig workers per 100,000 inhabitants. A significantly higher share is enjoyed by Albania and Montenegro, although a relatively small number of gig workers are engaged in those countries.
The latest measurement brought changes related to the distribution of freelancers by certain professions. The relative share of gig workers in the two dominant sectors (creative services and multimedia and software development) fell by almost four percentage points, so they now account for just below 58 per cent of the total number of gig workers in these two professions. In addition to the drop in these two professions, a decline was also recorded in sales and marketing. On the other hand, there was a slight increase in the share of gig workers in professional services, administrative services, data entry and writing and translation.
Though relatively small, the scope of the changes is not insignificant. Specifically, these trends indicate that Southeast Europe’s online labour market is becoming increasingly attractive to those with a less sophisticated skillset. The negative aspect of such a development is that these professions are paid less, and thus the total market value – measured by total generated income – is lower. The latest measurement showed significant changes regarding the comparative advantages of the countries in terms of professions.
WHAT IS GIGMETAR?
Gigmetar looks at developments in the gig communities of Serbia and Southeast Europe: Hungary, Romania, Bulgaria, North Macedonia, Albania, Montenegro, Bosnia-Herzegovina and Croatia. This index seeks to identify the structural aspects of the gig labour market and the similarities and differences between gig workers in the region, as well as identifying trends and evolving changes.
Albania has the highest values in two areas relative to the regional average, and to all the other countries in the region. These are professional services – a new area – and sales and marketing, as was the case in the previous measurement. It is uniquely assessed against this characteristic, as no other country has two areas of pronounced advantage relative to the other countries. Furthermore, Albania also has a more significant advantage in software development.
Looking at all professions, Bosnia- Herzegovina, Bulgaria, Montenegro and Croatia show the lowest level of specialiasation, as there are no professions with the highest share in any of those countries relative to the other countries of the region, or that deviate significantly relative to the regional average.
The dominant occupation among gig workers in all other countries is multimedia and creative services, with the exception of workers from Hungary, where writing and translation lead the way.
Romania, with the second largest population of gig workers in the region (after Serbia), became a regional leader in software development. In North Macedonia there is a pronounced comparative advantage in data entry and administrative services.
Serbian gig workers continue to dominate in multimedia and creative services – the highest number of freelancers is concentrated in this area and their share exceeds the regional average by 5.2 percentage point.
Our sample is dominated by men in platform work: 635 of the 1,000 sampled. Nevertheless, the latest regional measurement shows a 2.1 percentage point increase in the share of women, primarily thanks to a higher number of women among new freelancers. The share of women increased in all of the region’s countries except Croatia. Considering gender structure by country, significant changes are noticeable. Namely, although men constitute more than half of the gig population in each of the countries of the region, the percentage of female gig workers in two countries (Albania and Montenegro) still exceeds 40 per cent. A higher share of women relative to the regional average can also be found in Bulgaria, Hungary and North Macedonia. The latest measurement again shows the most unfavourable gender structure in Bosnia-Herzegovina.
The demanded average hourly rate remained practically unchanged relative to the previous measurement. One may conclude that the labour market has stabilised, at least with respect to hourly rates. Croatia remains the country with the most expensive workforce ($24.04/h), and North Macedonia remains the country with the cheapest workforce ($16.05/h). Hypothetically speaking, if a Croatian freelancer worked 176 hours (the maximum number of possible work hours in regular employment) in August and earned an average gig worker income, he would have earned $1,406.24 more than a colleague in North Macedonia who had the same level of engagement and earned the average hourly rate applicable in his country.
Differences among countries are also evident with respect to the demanded average hourly rate. It only exceeds $20 in the countries that are EU member states. However, all of them – along with Albania and Montenegro – recorded a decrease in the average hourly rate. This was most pronounced in Croatia – 72 cents per hour – and least pronounced in Montenegro – only 0.02 cents per hour. On the other hand, the other three countries that have significantly lower average hourly rates recorded increases: from 0.81 cents in Bosnia-Herzegovina, to more modest increases in North Macedonia (0.26 cents) and Serbia (0.19 cents).
The positive consequence of the pandemic identified in the previous period (convergence of (average) earnings between men and women) was also confirmed by the most recent measurement. The average hourly rate of women increased by 2.4%, meaning that they earned 83.54% of the average hourly rate of men in August. The initial negative impact of the pandemic on the convergence of income (recorded in May and October 2020) seems to have definitely disappeared.