Corporate India has become more dependent on temporary staffing, according to human resources experts.
Anita Belani, country head of the human capital group at Watson Wyatt India Pvt. Ltd, said industries with fluctuating demand such as retail and logistics have used temporary hiring as a business strategy since they can quickly ramp up teams as needed.
Experts said that temporary staffing has become increasingly important for the survival of Indian firms, given the fast growth rates and talent shortages in various sectors. High- growth sectors of retail, manufacturing, banking and financial services, IT, airlines, hospitality, and business process outsourcing are increasingly dependent on temporary staff.
Temporary staffing firm TeamLease Services Pvt. Ltd recently released a study that showed the salary gap between temporary and permanent jobs has narrowed down. But temporary employees in India still earn lower salaries than permanent ones, which is a reverse of the global trend.
Rajesh A.R., vice-president of TeamLease’s temporary staffing unit, said that in more mature markets abroad, temporary employees often make more than the permanent staff, and this phenomenon has been slowly emerging in India.
This is because employers have increasingly blurred the lines between temporary and permanent staff work, treating it more like project work. Also, the increasing number of staffing agencies have reduced their costs, which many companies have passed along to employees.
In the past 18 to 24 months, several foreign players have entered India, including US-based firms such as ManPower Inc. and Kelly Services Inc., and there is space for more, says Rajesh.
Employees interested in temporary positions vary in their motivations. Belani said such employees fall into three categories—those seeking white-collar jobs, but lacking the right qualifications would use a temporary position as an avenue to a better job. Then there are labourers willing to do contract work. Also, there are people—in particular women with family obligations—who want the flexibility of entering and exiting the workforce easily.