What is the future of Staffing Business in India?

With the proliferation of MNCs coupled with a great rise in domestic entrepreneurial ventures over the last decade has placed India in position where the demand for staffing is like never before. The buzz in the market is that the staffing industry in India is expected to grow quite a bit by 2020, fueled by the need, on the one hand, for a flexible workforce, and on the other, desire from the worker for a mobile, educational and flexible work arrangement.

Recently, Indian Staffing Federation (ISF), an apex body of flexi staffing industry in India comprising of about 30 members from the staffing industry, organized a National Conclave on Staffing – ‘The future of Employment to galvanize the recognition of staffing as a choice of employment both by employers and society’. It was noted that at a time of burgeoning black economy, staffing could be a strategic and cost effective approach taken by the companies.

staffing future

Mr. K Pandia Rajan, President, ISF said, “It is pertinent to note that India is among the top five nations in flexi staffing industry but, it stands out as the only one where the flexi staffing industry does not have a regulatory recognition as yet. Going by the Economic Survey report, it becomes more viable to make necessary provisions, set up guidelines to encourage contract staffing in areas, roles, industries where it can add utmost value. Ratification of ILO Convention 181 can be a positive step in that direction in order to fully reap the benefits.”

India has been projected to be among the largest staffing countries along with Brazil, china and South Africa by the global staffing market. Staffing in India, like other developing countries, is at a very vital juncture as a large proportion of workforce belongs to the unorganized sector having low or almost no social security. From current global experience, the demand for flexi staffing (for providing flexible solutions to both workers and employers) would increase predominantly in the ensuing years. In 2013, a modest growth rate was noted in the Indian Job market, owing to increasing number of executive search firms and large-scale hiring by the public sector.

According to a report by Staffing Industry Analysts, the Indian staffing industry is estimated at Rs 26,650 crore, wherein flexi (flexible) staffing accounts for 75 per cent and is worth Rs 19,900 crore, permanent recruitment accounts for 12 per cent (worth Rs 3,250 crore) and other services 13 per cent (Rs 3,500 crore).

The major international staffing firms or executive search firms have been taking up staffing in India, considering the growing potential of the market here. According to the ISF, there are at present 1.3 million temporary workers in the organized sector which is likely to swell to 9 million workers in the next 10 years.

Ms Rituparna Chakraborty, VP, ISF, has been found quoting, “Considering the pace at which the industry is growing in India it can easily outnumber all countries in the next 12 years with the sheer size of flexi-staff deployed in the formal sector, given the opportunity. By 2025, it is expected that 10 per cent of the overall workforce in India could be working in a flexible capacity through staffing companies.”

The economic climate in India is propitious for the future of staffing services. The Indian government also must ensure to make the economic environment viable for the staffing industry to reap out the maximum benefits.