Part-time hiring, full time job

Freny Patel in Mumbai | January, 2005 09:27 IST

An employment "boom" is drawing global temporary employment agencies to the Indian jobs market. At stake is over 3,000 open positions on demand daily, a demand kept alive by the telecommunications, information technology and financial services industries.
Foreign placement agencies are signing up thousands of temporary staff for placement with clients. These agencies include ManPower, the biggest employer in the US; Kelly, another US-based temp agency; the Swiss company Addeco; and the Netherlands-based Vedior. And more foreign agencies have plans to set up shop here.

There is only one large Indian consultancy -- TeamLease Services with an annual payroll of Rs 120 crore (Rs 1.2 billion) -- surviving in the temporary jobs market. Adaco has acquired People One and Vedior has bought Mafoi Consultants.

The temporary jobs market the world over is in excess of $200 billion, with billions of people opting for part-time jobs as their lifestyles change.

In India, temporary employment bureaus are outsourcing 2,000 people a month on average to companies and banks. Even this is not enough; the demand far outstrips supply, says an executive with an US-based agency.

Private banks face an attrition rate of 45 per cent among frontline staff. The private insurance industry, in its fourth year of operations in India, has seen an attrition rate in excess of 25 per cent.

The booming telecommunications industry is among the biggest employers of temporary staff, says a human resources consultant with a Mumbai-based telecommunications company.

"Many banks and companies are taking temp staff on test before making them permanent," says Manish Sabharwal, chairman, TeamLease Services. About 45 per cent of such staff get permanent employment in a year's time, he adds.

India has a population in excess of 1.1 billion, of which only 400 million constitute the labour force. Within the eligible labour pool, 30 million are part of the organised labour force.

There are about 50,000 temporary staff as part of the white-collar labour pool, but this number can easily rise to 4 per cent of the labour force, says Sabharwal.

The new private banks use temporary employees mainly for tele-marketing because such workers need the flexibility of operating from home, particularly new mothers.

"Our conversion rate from tele-calling is higher than from direct mailers," says an ICICI Bank executive. "We take a lot of temporary staff to handle peak demand during the holiday season, and for year-end closing," says an executive with another private bank.

The hitches India faces in pushing this market are official. The labour ministry believes contract labour creates problems. It feels temporary employment pulls jobs away from permanent labour pools, and also brings down salaries.

The Reserve Bank of India feels temporary staff ought not to be used for sales jobs in order to protect customers, and to ensure that banks fulfil the "Know Your Customer" criterion.

Temp strategy Who all are here?

ManPower, the biggest employer in the US; Kelly, another US-based temp agency; the Swiss company Adaco; and the Netherlands-based Vedior, which acquired Mafoi Consultants
What's fuelling demand?

There is huge demand from the telecom, financial services and IT sectors for temporary staff. Private banks face an attrition rate of 45% in frontline staff
Why temp is popular?

Companies "hire temp staff for a test drive, prior to making them permanent", says a headhunter. About 45% of temp staff get permanent employment in a year