Spoiling the gig economy party.

Tough political decisions or not, the steep upwards adjustment in fuel prices over the last few months has made life difficult for everyone, as the hike has further passed on to other goods and services and made everything more expensive. But it has especially hit gig workers whose entire livelihoods revolve around it.

Over the past few years, a flurry of transport and logistics startups - from mobility to delivery - have sprung up in Pakistan. Including the now-shut Airlift's and currently operational Krave Mart's investments, these players have raised a cumulative $208.5 million since 2019. Usually, the model is to leverage a fleet of 'independent contractors' who help move goods and people.

In mobility, the companies take a certain commission of around 20 per cent while delivery players often pay their riders on a per-order basis, which depends on a host of factors. Whatever it is, the recent fuel hikes have made it difficult for gig workers to get by.

'I need to fill the tank with petrol plus basic maintenance costs. Meanwhile, the company is giving me a fuel allowance of just Rs4,700 for the whole month after a recent revision. That not only fails to cover my petrol costs but also ignores the overall increase in inflation of other items that we have to bear now,' says a Foodpanda rider. 'My income, all included, is about Rs16,000 weekly if I work 12 hours a day on average,' he adds.

Recurring fuel rate shocks not only disproportionately burden riders but also put in question the future of companies operating in the logistics space

This is despite the fact that the company has consistently raised its delivery charges, which are usually in excess of Rs100 now. While that could be the phasing out of discounted prices and not necessarily fuel cost adjustment, the impact has not entirely passed on to the riders even as customers are paying more.

'In these difficult economic circumstances, we have tried to support our rider communities through increasing payouts and fuel cost pass-through to cover the increase in operational costs. We continue to monitor the situation proactively and regularly engage with our riders to ensure we support them effectively and continue to provide a seamless platform experience to our customers and vendors,' said Farhan Khan, Director of Operations, Foodpanda Pakistan.

Meanwhile, Bykea has revised its pricing upwards in view of the changes in petrol rates. Since the company operates on a commission model, the...