Representative image of women in workforce.
Credit: iStock Image.
Bengaluru: There is a strong preference among the younger population for fixed-term contracts in the job market, as 71 per cent of the country's flexi workforce are under the age of 30.
Also, women's participation in the flexi workforce stands at 25 per cent compared to an overall workforce average of 34 per cent in India, according to a study released by the Indian Staffing Federation (ISF), the apex body representing flexi staffing companies.
The Indian Flexi Staffing Industry 2025: Sectoral & State Analysis, released on Thursday, pointed out that the difference in gender representation might be due to the commonality of male-dominated positions across sectors that are shifting towards more flexible working arrangements.
It stated that the country's flexi workforce is projected to increase from 7.23 million in FY25 to 8.09 million by FY26 and 9.16 million by FY27 with a CAGR of 12.6 per cent.
The study projected the formal flexi-staffing market to reach Rs 2,20,000 crore revenue in FY26 from the present Rs 1,90,000 crore revenue. The increasing demand in growing sectors and a move to flexi work models are expected to boost headcount, generating an additional Rs 68,000 crore in revenue by FY27.
"Geographically, a significant portion of the formal contract workforce is being concentrated in five key states: Maharashtra, Karnataka, Uttar Pradesh, Tamil Nadu, and Telangana. The emerging growth in Tier 2 and 3 cities is particularly encouraging, as it signifies a deepening of formal employment, offering temporary workers the security of recognised employment, fair compensation, annual benefits, and health benefits," Lohit Bhatia, President, Indian Staffing Federation, said.
He added that the trend has picked up due to the increasing availability of skilled labour in Tier 2 and 3 cities such as Coimbatore, Mysuru, Salem, Hosur, Indore, Bhopal, Noida, Kanpur, Surat, and Vadodara.
Interestingly, Karnataka leads with 24% flexi workforce share out of its total formal workforce, followed by Haryana at 16% and Maharashtra at 15%. Also, Maharashtra (Rs 41,204 crore), Karnataka (Rs 32,423 crore), and Tamil Nadu (Rs 15,703 crore) contribute 47% revenue of the total industry, due to a larger flexi workforce concentrated in sectors like IT, BFSI, Automotive and ITeS.
The shift towards a more flexi workforce in the next 5 years will be driven by several key factors. Industries such as e-commerce, retail, and hospitality experience significant demand surges during peak seasons, such as festive sales, which necessitate a temporary increase in staff. At the same time, rapid industrialisation and growth in sectors like IT, retail, e-commerce, and manufacturing are creating a sustained demand for workers, the study said.
To address these needs efficiently, companies are increasingly hiring temporary staff to manage short-term projects and seasonal workloads.
Notably, formal staffing deployments are expanding beyond traditional roles to include specialised positions and are reaching beyond metros.