Labor market transformation in the hospitality gig economy in a post pandemic era: impacts of institutional governance

Purpose: The COVID-19 pandemic has caused the food delivery sector to boom as people continue to rely on services provided by online catering platforms (OCPs). However, because of the nature of sharing economy employment, gig workers’ contributions went largely ignored until intervention from institutional governance. This study aims to explore the impacts of labor market transformation after the Chinese Government issued guidance to promote gig workers’ welfare as a focal case. Design/methodology/approach: Focus groups and the Delphi technique were used to explore associated impacts on OCPs and gig workers based on governance theory. Findings: Results show that institutional governance negatively affected OCPs’ operating cost structure but sustained gig workers’ welfare. The dual effects of market mechanism and institutional governance in the sharing economy are needed to be balanced for labor market transformation. Research limitations/implications: Long-term equilibrium can be fulfilled, given the growing food-related demand for the market mechanism. Social reciprocity is expected to be realized through institutional governance for gig workers’ welfare. Originality/value: This study suggests that moving from market governance to stakeholder governance, as mediated by state governance, could transform gig workers’ labor structure in the gig economy. This study presents an integrated governance theory to enhance the epistemology of institutional governance.