23-Dec-2019
Temporary Staffing Agencies have been
involved in actively fostering a growing market for flexible staffing
arrangements, signifying that this industry acts as a powerful shaper of the
contingent labour market rather than simply being intermediaries between
temporary workers and employers.
One of the direct impacts of a
changing business ecosystem on companies has been on their talent demands.
Rapid shifts brought in by technology and evolving market conditions have meant
that companies have to often chart their talent demands beforehand and work
proactively to stay ahead of the curve. This has meant that staffing firms have
a larger role to play. But that is not the only reason why the staffing
industry is slowly becoming an important partner in helping organizations meet
their talent demands.
Large companies are cutting down wage
cost while start-ups want to hire executives only for a short period. Now,
there is a solution for both. Flexi or temporary staffing is fast catching up
in India with retail, logistics, FMCG and start-ups with the IT industry taking
the lead.
Both employees and companies benefit
from flexi-staffing. Employees can work as and when they feel, take a break and
re-join when they wish to. Companies, for their part, recruit 'just in demand' or 'on a need' basis.
The Indian Staffing Federation (ISF),
an association for the recruitment sector, said that flexi-staffing grew at
16.3 per cent to reach 3.3 million in 2018, out of the total 463.4 million
total workforce.
This industry is expected to grow at
22.7 per cent to reach 6.1 million strong workforce by 2021, according to a
report on the 'Impact of Key Reforms on Job Formalisation and Indian
Flexi-Staffing Industry 2019' by ISF.
The process of temp staffing in India
has proved to be one of the best business solutions in the industry, due to
work flexibility and easy hiring. While companies can only hire extra employees
when required, employees can develop good working experience by working with
many companies, within a short period of time.
It's a win-win for both companies and
temporary staff. Unlike the traditional hiring, temp employees can get training
on new skills and opportunity to learn job functions from grass root level. For
companies, recruitment and replacement is easy through temporary staffing.
Technologies like could computing,
A.I., automation are redefining how processes have been traditionally executed.
Many of such changes are slowly, but surely, becoming an indispensable
component. A similar trend that impacts not just India but also talent
companies globally is the use of AI to facilitate recruitment. Artificial
intelligence is bound to be a strong ally of staffing firms when it comes to
addressing issues like unconscious bias, data crunching, and hiring the best
fit. As the range of talent issues that staffing firms deal with diversify,
using AI would be a great advantage to find the best fit and ensure a seamless on
boarding process. It will significantly reduce the time it takes to
source a candidate and will also enable staffing firms to understand the need
of their clients better.
In a report released earlier this
year by Indian Staffing Federation 'Impact of Key Reforms on Job Formalization
and Flexi Staffing' many important insights were revealed.
The report throws light on most
effective reforms & initiatives and their subsequent effect across sectors
in job formalization. It also identifies emergent challenges in the transition
from informal to formal employment.
Key Finding of the report:
- At 3.3 million flexi staff in 2018, India emerges as
the 5th largest worldwide for in flexi-staffing
- The space grew at a CAGR of 16.3% in 2018 which will
further accelerate to 22.7% from 2018-2021
- 1.2 million added to flexi-workforce since 2015;
further 1.53 million to be added over the next 3 years
- GST & demonetization were two key reforms to drive
Job formalizations in 2016-18.
- Reforms/policies to formalize around 11.03 million
jobs between 2018-21
- Current and imminent policies and reforms to catalyse
the push from informal to the formal sector; over 7 million jobs formalized
between 2015-18; 19.9 million workforce growth (formal sector) in 2015-18,
includes shift from informal to formal
- India to have 6.1 million flexi workforce by 2021;
IT/ITeS leads adoption with 12.5% penetration
- Flexi-staffing has the potential to be among the key
job creation engines
- Sustenance of reforms and policy changes is key to the
momentum being maintained
- Logistics, BFSI, IT/ITeS, retail and government - top
5 sectors employing over 55% of total flexi workforce by 2021
Studies have shown that the staffing
industry is poised to grow significantly in the coming years. With the onset of
rapid labour market changes, many businesses have had to proactively anticipate
and tackle their talent issues. This is also the area where the staffing
industry in India has, and is bound to play an important role. But such growth
also hinges on how effectively they can adapt to some of the major shifts that
are taking place in the industry right now.