Flexi-staffing or Flexible staffing is an arrangement in an organisation where the employees can be from temporary agencies, or they could be leased, employees, or contract workers.
According to a report, in June 2019, by the India Staffing Federation (ISF), the apex body of India’s flexi-staffing sector, workforce under flexi-staffing grew at a compound annual growth rate (CAGR) of 16.3 per cent to 3.3 million in 2018 as compared with 2.1 million in 2015, forecasting that it would accelerate to nearly double—to around 6 million—by 2021.
The report showed that India has emerged as the fifth-largest market worldwide in flexi-staffing in 2018, after the US, China, Brazil, and Japan.
It stated that the top-five sectors that would employ over 55 per cent of total flexi-workforce by 2021 would be logistics, banking, financial services, and insurance (BFSI) and IT/ITeS, retail, and the government. The e-commerce market may lead the flexi workforce growth with over 50 per cent CAGR.
UPSC Exam Preparation eBooks
The rise in the number of flexi-staffing (temporary) workers indicates formalisation of workforce: around 7 million jobs were formalised in 2015–18, taking the number of formal jobs in the country to around 75 million during the period. At the some time, there was a fall in the percentage of casual workers from 70 per cent to 68 per cent during the period. It is predicted that by 2021, the total number of formal jobs in the country would increase to around 100 million. The report has traced the progress to e-commerce and manufacturing industry. They can get provident fund, group insurance, health insurance, and other social security benefits available to formal sector workers. Besides, the employers have virtually no legal obligation to comply with 44 labour laws, which are taken care of by the contractors or flexi-staffing firms.
Reforms such as Skill India Initiative, GST Reform, EPF Reform, and ESIC Reform have had a notable impact on job formalisation, revealing that Haryana, Gujarat, Karnataka, Madhya Pradesh, Andhra Pradesh, and Telangana are the states with high growth potential for flexi-staffing.
With one million youth added to the workforce every month, the India’s position and performance in the labour area is significant and of interest to the world. Flexi-staffing, a key job creation engine, has rapidly gained momentum in the years 2015–18, due to some of significant reforms and policy shifts, such as accelerated transition from informal to formal employment during these years. The goods and services tax (GST) and demonetisation are two key reforms expected to drive job formalisation, to formalise around 11.03 million jobs between 2018 and 2021.
Circular Economy to Generate Jobs