CASE-Indian Staffing Industry(SWOT Analysis)

Submitted By: -

Aparna Singh - 19021141023

M.B.A. ( 2019-21)
Introduction-

Staffing industry functions within the business services finding workers for the
client companies. Staffing firms fundamentally deal with temporary and
contractual jobs and job positioning. Over the last 18 years the staffing industry
has shot up its revenue from a million to a billion-dollar industry today. It has
grown to an exceptional level especially in the area of a third-party payroll service
provider. The industry has demonstrated a lot of action with the development of
business and trade. It has also demonstrated noteworthy development in the
courses of time. In recent years the business has developed at a pace of 20percent -
25 percent every year and isn't giving any indication of easing down back so far. It
also gives a platform for recognizing employment, work choice, reasonable
compensation, yearly benefits and health benefits for the temporary workforce.
According to the Indian staffing federation, the pinnacle body of staffing business
says the staffing industry comprises 15 main firms which accounts for 270 billion
in revenues. Shorter tenure of senior executives, multiple job opportunities, the
emergence of new industries like insurance, telecommunications, e-Commerce
over a period has grown the staffing industry. A highly skilled enterprise like IT
and engineering industry has utilized the outsourcing of staff to enlarge their
repeating needs. Limited tasks and projects are viewed as flexibility in the
technology industry. Large brands utilize contracts as a recruitment model to test
talents before onboarding them. Factors like demonetization and GST have pushed
formalization of work at a faster rate. Organisations look for labour forces in the
nick of time. Many large consumers and BFSI today need to expand themselves to
the rural markets so more market penetration is needed and more workforce is
required , hence outsourcing staff is the only logical choice. IT companies are
forced to work with lower bench strength. Skills are fleeting in the technical space.
Organisations are not able to predict the skills required for the future in the IT
sector. Engineering and technology organisations have to hire more “just in time”
workforce. This leads to a rise in expert staffing. Currently, IT and engineering are
utilising major chunks of the specialized staffing market. Going ahead, accounting,
sales, home care could be the next leading segments in the future.

Trends affecting the Staffing Industry-.

1.Skill and talent gap issues in India-It has been found that 39% of employees in
India find that searching for quality talent is one of the most challenging aspects.
While 90% of the jobs are skill-based only 2% of the population posess the desired
skills. This poses a tough challenge for the industry and the employers are looking
at third-party payroll providers in a big way.
2.Technology-Technology will end up being a significant empowering agent for
staffing organisations especially in the field of IT staffing. It is estimated that AI
can automate 75 percent of the enrollment cycle. A staffing firm will need to invest
time in automation solutions for time, attendance and expense management to
improve effectiveness and exactness for consistency and endorsements.

3.Most of the good talents today take up freelancing or contractual jobs and
staffing firms would play an important role in pacifying the relationship between
freelancers and their clients.
4.Training is starting point of developing a temporary workforce. A company with
the training facilities has an edge in terms of a temporary workforce.

Staffing assists with finding and recruiting individuals who are equipped for the
work position and will profit the organization. It additionally improves the quality
and amount of work done by the organization since they have staffed the ideal
individuals. Jobs fulfilment rates are probably going to increase since everybody is
appropriate for their position and is happy with their forte of work. Higher rates of
productivity from the organizations are also common as qualified individuals are
recruited for the jobs.
The staffing industry incorporates organizations that list business openings, place
candidates in work, supply brief labour force and any business-related
administrations. The market size of the Indian staffing industry was INR 26650
crores in 2014 and is growing between 10-15% every year. The staffing industry
can be classified as-

1.Temporary staffing-Firms that hold labourers and supply implement labour

force to different organisations for explicit tasks. This is the biggest portion with a
market size of INR 199000 crores which are 75 percent of the market. This is
fundamentally a direct result of pass-through compensation costs remembered
through for the income of such firms.
2.Permanent staffing-Sourcing, screening and onboarding of up and comers from
junior level to positions to CXO level positions. The business structures about 12%
market with a size of INR 3250 crores. It incorporates just the net charges from
each fruitful reference/enlist.
Some of the top staffing agencies in India are-Adecco, Manpower, Ikea, Global
innovsource solutions, Genius consultants, Allegis, ABC consultants, Team lease,
Randstad , Infoedge.
SWOT analysis-
Strengths-
1.Staffing agencies find work possibilities for job opportunities. Several agencies
specialize in a particular industry or areas. They create testing outfitted to decide
the range of abilities of the candidates. Also, the candidates are screened before
sending them to the interviews like their job histories and background. Their
administration saves time yet may cost cash.

2.Filling a job opportunity is generally a quick task with the help of a staffing
agency. They let the candidates gather knowledge about the job description and
also the desired qualifications. The agency recruits the candidates that fits the
desired criteria. This saves a lot of time as there is no need to advertise much about
the position, chuck out unfit candidates.

3.The staffing agency allows checking on the candidates before offering the job.
The candidates sent by the agency remains an employee of the agency for a fixed
period of time. This also allows observing the candidates abilities to work well
with other employees. It could likewise be perceived how effectively a candidate
adjusts to a new position.

4.Temporay contracts are also used to work for temporary vacancies like
employees sick leaves, maternity leave and work overflow. Employing in the
temporary staff members saves money by evading extra time costs and prevents
permanent employees from getting worn out by working for excessive number of
hours. This can help retain employees.
5.Workers hired through staffing agencies are highly skilled and experienced. This
is because of various reasons, such as increased flexibility, the better connections,
the negotiation assistance, the opportunity to work in different fields and for
different companies

6.Staffing also helps candidates get permanent employment. Candidates use the
experience and the connections gained in temporary jobs to gain permanent
employment. Candidates grab such opportunities based on their job assignments.

7.Big companies cut down wages and startups want to hire candidates only for a
short period. Temporary staffing is fast catching up in India with retail, logistics,
FMCG and startups with the IT industry taking the lead. Employees work as and
when they feel, take a break and then rejoin as per their choice.
8.The process of staffing in India has proved to be the best business solutions in
the industry due to flexibility and easy hiring. Companies hire extra employees
when needed while employees can develop good working experience by working
in different companies within a shorter period.

9.In staffing employees can get training on new skills and techniques to learn job
functions from the starting level.

10.The banking industry today has evolved into a highly competitive industry by
constantly changing markets and to cater clients' needs efficiently. There is a
greater demand in the banking industry for better systems and software to handle
their workload as well as demand for competent individuals.

11.From an administrative point of view, a temporary worker is less costly since

there is less time taken for processing of timesheets and paychecks which are
normally handled by staffing agencies.

12.Small business usually does not have a huge HR department with dedicated
staff. The hr might have to spend a lot of time going through the resumes of the
desired candidates. Time can be saved if such CVs are prescreened by staffing
agencies that only send fit for the role candidates.
13.Some of the staffing agencies have also demonstrated a strong presence in the
new markets. Also with some of the staffing agencies undergoing successful
mergers and acquisition like Randstad acquiring Vedior in 2007 and Monster in
2016 has paved the way for many staffing agencies to increase considerable market
share that helped them grow globally. Hence this integration has helped staffing
agencies use the latest technology and streamline its operations to connect the right
people to right jobs

14.Most of the staffing agencies expansion into new markets has increased
visibility and a given them a strong brand presence.

Weakness-1.Temporary workers lack loyalty as permanent workers. If they feel

that their needs are not being met they might not turn up or even not do the work
perfectly. Temporary workers might be putting in fewer efforts to meet the bare
minimum requirements of the tasks in hand.
2.There are some legal issues as well with the employers who keep temporary
workers for longer periods and obliging to do all the work of the permanent
workers.
3.Loss of productivity if temporary workers do not work efficiently.
4.If the company wants to hire temporary workers for the full time they might have
to purchase workers contracts with the staffing agencies hence bearing extra
expense for the company.
5. Losing market share in niche categories to its competitors.
6.Workers hired through staffing agencies do not enjoy the benefits as received by
the permanent employees. Since the temporary workers are employed through the
staffing agencies they may or may provide all benefits to them. Benefits such as
retirement plans and pensions are not available to temporary workers.

Opportunities-
1.Stafing agencies should be updated of the latest economic trends and should be
ready to negotiate fees with the clients to retain long term contracts.
2.Focus on one specific industry or area so that agencies can focus on its capital
and marketing efforts with the clients.
3.Build a pipeline of strong candidates who are easily hired by the clients.
4.Increase the presence in social media platforms, digitization and uses of data
analytics.
5.During the times of economic uncertainty companies expand or layoff
workforces. Staffing agencies roles here acts as a cushion in mitigating the hiring
or firing of a considerable amount of workforce.
6.In the struggling economy where jobs are less, workers would be willing to do
whatever is needed.

Threats-
1.Staffing agencies charge fees from the employers for the services they provide to
stay in business. But the company always looks for the best deals. The staffing
agencies that have a greater overhead cost might lose company clients with the
other staffing agencies charging less.
2.The loss of clients would lead to a loss of talent pool as people move to the other
staffing agencies who can place them.
3. A lot of staffing agencies covering the same industries so more competitors.