The blue-collar workforce has largely been a technologically underserved consumer base. An average blue-collar worker is treated as a commodity and has little to no digital presence. For instance, they have no validation in the financial system. In India, less than 10% of people have access to formal credit, due to the absence of formal borrowing history. A huge section of the population in rural and urban areas has for years lacked the digital ecosystem to grow their opportunities and livelihood.
However, the rapid penetration of smartphones and internet connectivity in this consumer base is set to change the narrative. As per a June 2021 report by the Internet and Mobile Association of India (IAMAI), digital adoption continues to be propelled by rural India, with a 13% growth in internet usage in 2020. By 2025, rural parts might have more internet users than urban India.
Given these trends, large tech-led disruptions in the sector are on the cards, in the next 5 years. India is home to 450 million blue-collar workers. The size of this macro consumer cohort is startlingly huge. The fact that this user base houses 3 times more consumers, than what the new-age start-ups have focussed on sets the ground for innovative approaches that can make a huge difference for this ecosystem
Game-Changing Disruptive Innovation Set to Conquer Blue-Collar Workforce
Gig work has gained momentum in recent years due to adoption of disruptive technology. . Most of these jobs are in the lower-income type categories, such as delivering, ridesharing, care and wellness services, and micro-tasks. The pandemic has only accelerated the trend. A report by BCG says that India’s gig economy will expand to 90 million jobs by 2031; almost triple its size currently. The report also mentions a huge influx of millennials and Gen Z into the gig workforce, as companies undergo huge business transformation with the rapid inclusion of technology.
So far India has not seen any disruption in the blue collarspace, including fintech products, EdTech & health-tech. These initiatives have primarily targeted the higher-income strata in urban areas. With the understanding of the sheer size of the blue collar market and the potential business volumes it can generate for any product or service, it is becoming a green pasture for tech-led solutions.
Technology Accelerating at escape velocity for Blue-Collar Workforce
Early tech action has already started in this space. Over 70% of respondents in a 2019 survey believed that the influx of advanced technologies is the biggest driver for blue-collar work. Platforms are laying down underpinnings to power the discovery and distribution of vertical solutions for this user base.
Advances in data science, technologies like AI and machine learning (ML) are allowing companies to create products that workers want and need. At the same time, an operationally light, fully digital infrastructure is providing a better user experience as well. Some key issues to solve through technologies in the blue-collar workforce are:
- Simplifying services for semi-literate users: ML-based automation and intelligent vernacular approach can make processes simpler. For instance, automated video interviews, making a profile from ID cards, etc.
- Making services affordable: Technology can provide them access to affordable services in healthcare, financial products, and more.
- Multi-channel approach for easy distribution: Users need access to services on various platforms and get their queries resolved faster and seamlessly. For instance, chatbots, personal assistants, WhatsApp, and more.
Technology is aiding in the creation of a complete digital ecosystem to make their lives better. This is being done through a highly robust and agile tech stack for various areas some of which are in place, while others are still being developed.
Spread across districts and villages in India, identity verification for blue-collar workers was a task for companies. Background checks were difficult as they spoke different dialects and lacked a central repository to check criminal records, financial status, and more.
India is now aiming to add blockchain infrastructure to the ‘India Stack’ that will enable developers to build several products and services in this area. For the uninitiated, blockchain is a distributed ledger (a database) that can enable simultaneous access, validation, updating, and recording of data across multiple sites and geographies. Users will be able to own digital identity wallets. AI can bring solutions for improved onboarding, KYC automation, and enhanced due diligence.
Fintech companies are now relying on alternative sources of data, like cell phone bill payments, occupation history, and social media postings to determine the creditworthiness of a person. This is a huge boon for people who do not have CIBIL scores but need consumer finance products to fulfil urgent needs. AI and machine learning are helping lending platforms with richer data points, which can enhance traditional underwriting methods. Predictive analysis is driving fintech platforms to meet the relevant needs of this user base through affordable financial products like payday loans, investment, insurance policies, and more.
The pandemic has further fuelled the need for contactless payments. Digital wallets have made inroads in the blue-collar workforce as well. Digital banking enables employees to own zero-balance bank accounts, from where they can send money 24/7 to their families back home.
Many digital wallet companies have tapped into the ‘kirana’ stores. Many small businesses are now being able to accept payments through QR-code technology. UPI transactions can be easily accessed through mobile apps, and QR codes and they incur no charges.
Blue-collar workers are motivated by peer relations, salary growth, job security, and working conditions; just like white-collar workers. They value career development opportunities and need to feel appreciated. However, there is a lack of networking sites and job-search platforms for this user base. For instance, one will hardly find any workers from this sector on LinkedIn.
By introducing them to digital communities for re-skilling and job search, companies are trying to instil individuality and respect.
With the rapid advent of technologies, blue-collar workers in the future will focus less on physical and repetitive tasks, and instead engage in more knowledge-intensive and digital-oriented ones. Demand for skilled labour is always high. To imbibe specialized technical skills, data and digital literacy companies are now focusing on up-skilling initiatives. For instance, chatbot-based apps where workers can learn topics at their own pace, leverage AI to suggest similar courses and study materials online.
All-inclusive platforms allow workers to access tele-medicines anytime they need. This has been a huge revolution, as a majority section of the blue-collar workforce lack basic medical facilities despite working in precarious conditions.
Businesses have understood that there is a severe risk in failing to prime the blue-collar workforce. These workers can be a force for problem-solving, increased productivity, and creativity when appreciated and guided by technologies that make their lives better. Competitive pressures are only going to increase, as technologies disrupt all aspects of society. The time to act is now.