Nigeria’s gig economy has emerged as a significant force within the country’s labor market, with three million people now engaged in digital platform work, according to a new report by global research firm Ipsos, commissioned by ride-hailing company Bolt. The study highlights that ride-hailing accounts for nearly a quarter of this workforce, making it the second-largest category after e-commerce. The broader African gig economy, valued at an estimated $5.18 billion, is expanding rapidly as inflation and limited formal employment opportunities push more young people toward self-employment. In 2023, the World Bank reported approximately 17.5 million online gig workers across Nigeria, Kenya, and South Africa, with 87.3% of employed Nigerians being self-employed by the third quarter of the year.
Ride-hailing has become a key player in addressing employment gaps left by the formal economy. Ipsos found that participation in ride-hailing outpaces freelancing, micro-tasks, and remote work, ranking just behind e-commerce. The survey, which included over 250 drivers each from Kenya, Nigeria, and South Africa, revealed that 59% of participants remain active for more than a year. Motivations for joining ride-hailing vary across the continent: in South Africa, drivers seek financial stability; in Kenya, they value independence and self-sufficiency; while in Nigeria, the primary motivation is the flexibility to earn extra income on demand.
However, the Nigerian market faces increasing challenges. Rising fuel prices, which are projected to exceed ₦1,200 ($0.89) per liter in 2024—up from under ₦1,000 in 2023—along with naira depreciation and escalating vehicle maintenance costs, are eroding drivers’ profit margins. Although 64% of surveyed drivers reported improved living standards, many indicate that they must work longer hours just to cover their costs. Additionally, the sector struggles with gender imbalance, as women comprise only 4% of ride-hailing workers in Nigeria. In contrast, Kenya and South Africa are witnessing gradual improvements through targeted inclusion efforts.
For policymakers, the growth of the gig economy presents both opportunities and challenges. Weyinmi Aghadiuno, Head of Regulatory and Policy, Africa at Bolt, stated, “As flexible earning opportunities become more common across Africa, there is an opportunity for policymakers, platforms, and stakeholders to work together to ensure the gig economy continues to expand access to opportunity while remaining sustainable and inclusive.” While ride-hailing remains a vital source of income for many, economic volatility and rising operational costs will continue to pressure drivers’ earnings. The report suggests that platform innovation—such as the adoption of electric vehicles—and diversification into parcel delivery and food logistics could help mitigate some of these pressures and ensure the sector’s long-term sustainability.
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