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India – 600,000 new temporary jobs

01 June 2015

As many as 600,000 new flexi-staffing jobs are likely to be created in India this year, the highest on record, with salaries set to increase by as much as 20%, according to estimates by placement companies reported in the Economic Times of India. The rise in the number of temporary jobs is driven by a boom in ecommerce, retailing and manufacturing.

“With a million youth added to the workforce every month and with barely 2% having any formal skills, staffing is the most effective type of employment, which bends the curve in favour of our youth and helps them become further employable,” said Rituparna Chakraborty, senior vice-president and co-founder of Team-Lease Services.

“It could not have been a better time for flexi-staffing in India,” Chakraborty said. TeamLease, a recruitment consultant, human resource outsourcing and staffing company, placed 85,000 people in flexi-staffing jobs last year and about 16,000 workers in the first quarter of this calendar year, said Chakraborty, who is also president of the Indian Staffing Federation (‘ISF’).

Staffing companies such as ManpowerGroup, Randstad and Adecco, too, are betting on huge growth this year. Demand is seen driven by ecommerce, retail, IT, FMCG, banking, financial services & insurance (BFSI) and healthcare companies. With the government’s thrust on manufacturing, the sector is expected to add to demand for temporary workers.

Salaries are also likely to see a 15 to 20% increase at all levels, with maximum impact at the bottom of the pyramid, said Suchita Dutta, executive director, ISF. At the entry level, salaries typically start at INR 10,500 (USD 164) per month and go up to over INR 200,000 (USD 3128) a month for senior positions.

ISF members (41 companies) account for about 30% of the total staffing industry, most of which is still unorganised. According to ISF, temporary staffing or flexi-staffing is a fixed term employment to meet short term, niche or project-specific needs. People are employed by a staffing agency and then hired out to perform work at and under the supervision of a user company.

Frontline staff — customer services, sales and customer prospecting, and telemarketing — account for the vast majority of flexi-staffing. Other areas include technical functions such as installation and commissioning and repairs and maintenance, as well as senior positions such as technical specialists and management experts.

In the past 10 years, about 5 million temporary jobs were created in various sectors, with retail and ecommerce driving demand more recently. “Last year, demand for temporary workers was on a standstill for the first half. The growth in staffing was only 8%, largely led by the festive season and ecommerce in the second half. This year, demand has been up since the very beginning of the year,” Dutta added.

“This year, we are looking at a robust growth of 25 to 30% in the demand for temporary workers, triggered by sectors like IT, ecommerce/retail, FMCG, healthcare and BFSI,” said Moorthy K Uppaluri, CEO of Randstad India. ManpowerGroup is targeting placement of over 45,000 temporary workers this year, up from 37,000 in 2014.

Srikanth Rengarajan, executive director and president at ManpowerGroup India, points out that the talent in the space of technology, digital marketing, R&D and data analytics will attract a premium from this year.

Adecco, one of the country’s largest staffing companies, placed over 120,000 associates last year. “For this year, we are expecting a growth of around 20%,” said Angelo Lo Vecchio, country manager and managing director at Adecco India.

Apart from ecommerce, Adecco India is investing more in the BFSI and pharmaceuticals sectors. In ecommerce alone, it placed over 10,000 employees last year in temporary staffing. “We have an exclusive talent supply chain team which works for the ecommerce sector,” adds Vecchio.

“Staffing is expected to grow from the current 1.7 million organised workforce to 9 million by 2025,” said Chakraborty of Team-Lease.