INDIA TEMP & CONTRACT

STAFFING LANDSCAPE,
A 2018 STUDY
 02 Why read this report?
04 About the survey
05 Key takeaways
08 Findings
Nature of work
Challenges faced
Expectations & problems temp
& contract staff face
Future of Temp & Contract
Staffing
14 Directions for future
16 About Kelly & SHRM India

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WHY READ THIS
REPORT?
Of late, the Indian marketplace is seeing a rise in the concept of temp
& contract staffing; and organizations are resorting to outsourcing
recruitment via numerous staffing companies. The temporary staffing
scenario in India presents itself with various opportunities and also
brings in its fold, multiple challenges.
With increasing competition and business needs, it has become
imperative for companies to find the optimum mix of permanent and
temporary workforce to ensure increasing levels of productivity.
What are the implications of Temp & Contract Staffing across multiple
stakeholders: Potential candidates, organizations, HR and staffing
vendors?
Read the Kelly – SHRM report on the “Landscape of Temp & Contract
Staffing in India” to understand the benefits and challenges of such
staffing as well as the expectations and the role of staffing vendors.
This report will, in a nutshell, speak about the current state in India,
where it’s going and how to stay ahead of the curve!
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ABOUT THE SURVEY
For the purpose of the study, an online survey questionnaire was administered capturing the below
dimensions:
- Nature of Temp & Contract Staff
- Challenges faced with Temp & Contract Staff
- Expectations & problems Temp Staff face
- Future of Temp & Contract Staffing
The study was conducted during March 2018, and surveyed 111 HR Heads and Talent Acquisition /
Recruitment Heads across industries in India. Out of the 111 responses, 79 unique and usable responses
were considered for the purpose of analysis and drawing insights for this report.

SOME FACTS
Healthcare and Manufacturing / FMCG Sectors have the highest % of temp workers and thus their budget
allocation is also higher compared to other industries.
% of budget allocation for temp staff: Private (20%) and Public (10%)

Sample representation – Industry wise

Sample representation – Sector wise

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KEY TAKEAWAYS
Cost – Benefit is the top motivator for hiring temp & contract staff. Organizations are
moving towards filling temporary job vacancies in a cost-effective manner and therefore a
adopting flexible staffing strategy.
Healthcare & Manufacturing / FMCG see the maximum temp workers.

Quality of work, low engagement levels, high training needs, and cost of intermediaries are
the top challenges faced with employing temp & contract staff.
The primary demands of temporary workers are about decent pay and good living
conditions. They suffer from job insecurity and role ambiguity at the workplace.

Specialist temporary staffing agencies with quality service, who are well-known and have
a readily available talent pool are the need of the hour! These specialist firms can help
organizations effectively meet their staffing requirements.
Inability to meet statutory requirements, skillset mismatch, inability to meet timelines to fill
the vacancies and lack of proper background verification documents are the top challenges
faced with staffing agencies.

42% of the organizations surveyed indicated that they are very likely to employ temp &
contract staff in the next 3 -6 months.
Skills in demand are Niche Tech, Administration, Human Resources, Sales & Marketing,
Logistics, Legal, Finance and Accounts.
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WHY SHOULD ORGANIZATIONS CONSIDER
TEMP & CONTRACT STAFFING?
India Inc is an exciting space right now, with the world’s biggest brands having set shop and vying with home-bred
start-ups for market and resources. While that puts us in the midst of opportunities, it also throws open a number of
challenges – human resource being one of the most significant. The growth story needs drivers at all levels to fuel and
run it. Are we prepared?
Why Temp & Contract Staffing?
The organized employment sector has been in the spotlight for a while. Sharp-skilled and agile, India Inc boasts of a
competitive workforce. But do the numbers suffice? Probably not. Because the luminous organized sector still is a small
percentage of the total working population and gives way to a large unorganized sector which is hitherto untapped.
Enter Temp & Contract Staffing
While on one hand, Temp & Contract Staffing bridges the organized-unorganized divide, on the other hand it plugs the
resource gaps efficiently. The share of temp & contract staffing in overall workforce is predicted to rise to 10% by 2025.
Temp & Contract Staffing has been winning over recruiters everywhere because it gives what large organisations need
the most – Agility. Employees are recruited on a temporary basis from agencies called staffing companies. The chosen
employees may either be hired in sizable numbers to serve a function, for e.g. delivery boys hired by e-commerce
portals, or hired for specific roles, such as a marketing manager. The entire gamut of processes from hiring, on-boarding,
documentation to pay rolling, employee benefits and exits is facilitated by the staffing company. While the services
industry pioneered in flexi staffing, it has entered traditional laggard sectors like manufacturing as well. Verticals
across Agriculture & Agrochemicals, Automobile & Allied Industries, Consumer Durables, Power & Energy, FMCG,
Manufacturing & Allied Industries, BFSI, Telecommunication, Hospitality, Healthcare & Allied Industries, Information
Technology, ITeS and Retail have active temp & contract staffing practices.
Let us look at the advantages of flexi staffing or temp & contract staffing for an organisation:
Agile on-demand workforce : Organisations aren’t a static entity, and so aren’t the requirements. Flexi staffing helps
organisations’ scale up or down depending on their business cycles.
Leaner timelines : Since staffing companies are expected to be in touch with candidates, turnaround time while
onboarding candidates is less.
Lower costs : Helps clamp down on hiring, training, benefits and administrative costs.
Meet diverse requirements : Can be used across a broad range of skills and occupations to substitute for employees on
leave, on vacation or in emergencies. Also helps provide supplemental support to tide over temporary skill shortages,
lend technical expertise to specific projects, and meet peak load needs.
Lower legal risk and costs : Helps reduce legal risk and associated legal costs because most of the liability for complying
with employment laws falls on the staffing company.
Focus on core business : Gives an organisation more time to focus on its core business as contract employees are
managed by staffing agencies.
Permanent hiring : Organisations can hire the good performers on a permanent basis. This usually turns out favourably
because the organisation has been able to evaluate the temp worker’s capability and cultural fit.
While flexi staffing works greatly in the favour of organisations, it extends a lot of advantages to the flexi staff as well.
Contract workers hired at higher levels for specialised roles get to chart out a varied career path by handling diverse and
challenging projects in different organisations, thus building an impressive body of work.
Times are changing, and flexi staffing is a definite way forward towards the dynamic and highly demanding times that
lay ahead of us. A fairly new entrant but a promising one, the merit of flexi staffing lies in its inherent ability to offer
agility in leaner timelines and at lower costs. While the permanent workforce will always form the bedrock of any
organisation, flexi staff will play a vital role in keeping it light on its feet and ready – to sprint or to slacken. This report
in partnership with SHRM highlights some of the key trends shaping the Temp & Contract landscape and has some
interesting insights to share. We hope you enjoy reading this report!

Thammaiah BN
Managing Director, Kelly Services India

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7
 SURVEY
FINDINGS

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NATURE OF
TEMPORARY WORK
TOP MOTIVATORS to employ temporary staff
primarily are cost aspects and an openness to
experiment with hires to meet the immediate
demands of the workforce.
Since the motivation is to reduce salary costs
and find an effective way to replace full-time
employees, organizations are more likely to
hire temp staff.
HIRING PROCESS is a mixed bag, with a
preference for a specialist in temp hiring and
even direct as well as referral employment.
Organizations in private sector reported
that they hire temp staff through general /
specialist agency and sub-contractors, while
public sector reported that they hire mostly
through direct employment.

68% of organisations reported that they hire temp staff for a period of 6 months to 1 year. This
indirectly is a reflection of the short term projects and tasks assigned.

It is reported that most temp staff are hired for administrative work and they tend to have a higher
tenure (of more than a year) as compared to other job types for which temp staff may be hired.

TOP 5 MOTIVATORS TO HIRE TEMP STAFF

1 Reduces overall staffing costs and statutory compliance related work

2 Gets experience and expertise to full-fill short term needs

3 Allows organizations to “try out” potential hires

4 Cost effective way to replace full-time employees who go on leave

5 Lesser hassle in the hiring process

AVERAGE TIME PERIOD OF HIRING

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KEY FACTORS IN SELECTING TEMP & CONTRACT
STAFFING VENDOR

Prompt response Readily available Knowledge of local Well known in the Similar domain /
to need (Service) pool of talent markets and supply field of specialized industry experience
staffing in the past

It is observed that the participating organizations
have indicated that quality of service, availability of
requisite talent pool and a local market player who
understands the nuances of the job market and
ecosystem are the key factors they consider while
selecting a staffing vendor.
Even as companies are moving towards flexible
staffing strategies, often the hiring teams rely on
staffing vendors as the continuous source of temp
& contract staff. Thus, selecting the right staffing
partner to support organizational needs for temp
and contract staff is a key decision to make; as it
has a direct impact on quality of staff, budgets and
overall operational performance.

Identifying the key motivators in the organizational context to hire temp staff and partnering with the right
staffing vendor is the key here!

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CHALLENGES FACED…
WITH STAFFING WITH DOCUMENTATION
VENDOR OF TEMP & CONTRACT
Organizations in the private sector reported that STAFF
inability to meet statutory requirements, skillset

mismatch and inability to adhere to timelines are
the top challenges faced with staffing vendors.
Public sector companies reported employee
experience (w.r.t. salary not being paid on time,
issues with medical reimbursements, lack of
support during exits etc.) as the key challenge
that they face.
31%
Lack of proper background verification
documents of the candidate is the top
most concern, as reported by 31% of the
organizations surveyed.

TOP 5 CHALLENGES WHILE WORKING WITH STAFFING

VENDOR
1 Inability to meet statutory requirements

2 May not always provide the staff with the appropriate and desired skill-sets

3 Inability to provide staff as per required timelines

4 Inability to understand the requirements

5 Do not always have the number of temporary staff required

CHALLENGES WITH DOCUMENTATION OF TEMP &

CONTRACT STAFF

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WITH TEMPORARY WORKERS

INDIVIDUAL CHALLENGES ORGANIZATIONAL CHALLENGES

Quality of temporary staff Unreliability in supply of right skills

Less engaged than the permanent staff Need to supplement with in-house training need
Less reliable than permanent staff Cost of intermediate agencies

Robust processes and documentation, increasing the availability of talent pool across levels / jobs and taking
efforts to upskill / train the temp staff before deploying them in the client organization will lead to BETTER
ORGANIZANTION – STAFFING VENDOR PARTNERSHIP.

EXPECTATIONS AND PROBLEMS OF TEMP &

CONTRACT STAFF

TOP EXPECTATIONS OF TEMP & CONTRACT STAFF…

Decent pay & benefits (Insurance, Travel
Allowance and Rewards & Recognition)
Good working conditions
Learn skills that can be converted to full time
jobs
It is reported that
In private sectors, the primary expectation
is good working condition, followed by other
parameters like decent pay benefits and
convertible skills.
In the public sector, decent pay, parity in
treatment, convertible skills and job security are
top priorities.

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TOP PROBLEMS TEMP & CONTRACT STAFF FACE
Personal related Organizational related Sensing and acting on the
Job insecurity Inadequate employment security expectations, providing
better role clarity right in
Lack of parity Insufficient pay the beginning and better
engagement can lead to
Job dissatisfaction Role ambiguity
increase in the productivity
Low self-esteem Long working hours levels of temp staff.

For public sector, lack of social recognition and burnout feature as additional top problems that temp &
contract staff face at a personal level.

It is reported by the private sector that inadequate employment security is the top most problem while for
public sector it is insufficient pay, that temp & contract staff face at an organizational level.

FUTURE OF TEMP & CONTRACT STAFF

Confidence level to hire
42% of organizations who
responded, indicated that temp & contract staff in the
42% they are very likely to
employ temp & contract
next 3 – 6 months
staff over the next 3 - 6
months.

What are some of the future

temp & contract staff skills that
you foresee demand for?
Niche technology skills (AI, IoT)

Retail, Call Center, Logistics

Consulting & Sales

Niche IR skills

Recruiting
Temp staff is here to stay and they will only
Back office, Administrative & increase further in the future! Identifying and
Sales support training talent for niche skills and making
them available for the market is the key!
Payroll services

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 DIRECTIONS
FOR FUTURE

ACTIONS AND RECOMMENDATIONS FOR

HIRING TEAMS
• Support in reducing permanent staffing costs by hiring temp staff as per organization’s need
• Plan for temp staff much in advance to reduce the time to fill days
• Find a suitable match between the organizational requirement and the temp pool available
• Clearly define the skills, roles and responsibilities for the given position to the staffing vendor, so as to
avoid mismatch of skillset provided
• Share the organizational culture with the staffing vendor to ensure the right fit
• Explore the possibility of converting the temp staff to full time on the basis of the performance, skillset
acquired and need
• Analyse the business case to invest more in temp staffing if the industry is primarily dependent on such
staff
• Have key metrics and a robust process for employing a staffing vendor (understand their USP, modus
operandi, availability of talent pool etc. )

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STAFFING VENDORS
• Explore the following market segments better- Healthcare, Manufacturing / FMCG, IT/ITES
• Further build on the knowledge of local market supply and demand
• Strategize to increase the pool of temp staff across all available skills
• Provide requisite training (online / face-to-face) at regular intervals to ensure continuous learning / up-
skilling
• Match the organization needs with the available talent pool and ensure prompt service
• Bring in more stringent norms in meeting the statutory requirements and thereby reduce administrative
burden for organizations
• Further enhance proper and correct background documentation
• Provide clear role and responsibilities to the staff before deploying them in the client organization. The
intent being to support them by reducing the role ambiguity
• Ensure market competitive pay and regular touchpoints with the staff for better engagement levels

HR TEAMS
• Liaise with businesses and hiring teams to ensure that temp staff roles and requirements are identified at
the beginning of each year
• Ensure that roles and responsibilities are well defined and communicated to the staffing vendors as well as
temp staff when they join, to reduce the role ambiguity and increase their engagement
• Create engagement activities for temp and contract staff
• Understand what causes dissatisfaction for them and rectify the issues
• Provide good working conditions and parity between team members (permanent and temp staff on same
roles/team)

• Ensure temp and contract workers stay for a longer tenure by providing them job security, where possible

MANAGERS
• Identify temp staff requirements well in advance along with your business HR
• Given clarity of role and responsibilities during the interview stage itself if possible, else definitely on
joining
• Strive to provide a better work-life balance for temp staff
• Treat temp staff at par with regular staff
• Actively engage and interact with temp staff to understand their challenges and look at providing support

• Optimize the use of available temp talent for the job requirement to reduce turnover

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 ABOUT KELLY SERVICES INDIA
As a global leader in providing workforce solutions, Kelly Services, Inc. (Nasdaq: KELYA,
KELYB) and its subsidiaries, offer a comprehensive array of outsourcing and consulting
services as well as world-class staffing on a temporary, temporary-to-hire, and direct-hire
basis. Kelly® directly employs nearly 500,000 people around the world in addition to having
a role in connecting thousands more with work through its global network of talent suppliers
and partners. Global revenue in 2017 was $5.4 billion. In India, Kelly Services operates as
a joint venture with PERSOLKELLY, the largest workforce solutions provider in the region,
spanning over 50 offices across 13 countries.

Visit kellyservices.co.in and connect with us on Facebook, LinkedIn & Twitter.

ABOUT
KELLY AND SHRM

ABOUT SHRM INDIA

SHRM India provides a platform for thought leadership, sharing of best practices and
professional networking within the Indian and global HR communities in order to take the
profession higher through continuous and collaborative learning. It is a one-stop shop and
the go-to resource for solutions and services to handle all people-management challenges
With more than 290,000 members globally, membership is truly a unique offering that
provides rich content through comprehensive online resources on www.shrm.org. This huge
repository of articles, research papers, case studies and related material on every aspect of
HR within the Indian and global contexts constitutes the most current and comprehensive
body of knowledge in HR. Supported by a bank of over 50 subject matter experts and internal
expertise, the SHRM India Knowledge Center offers cutting-edge resources, across all the
key and emerging HR disciplines. These include thought leadership, advisory panels, tools and
templates, virtual events, forum and research.

As the leading advocate for HR professionals’ worldwide and providing HR research and
education, SHRM launched an unparalleled study to define not only the knowledge, but
also the competencies required of today’s HR leaders. The result of this rigorous research
was the SHRM HR Competency Model which forms an important foundation for the new
SHRM Certifications - SHRM Certified Professional (SHRM CP) and SHRM Senior Certified
Professional (SHRM SCP).