Indian firms prefer temporary staffing to cut cost

By SiliconIndia   |   Tuesday, 30 December 2008, 05:25 Hrs   |    8 Comments
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Indian firms prefer temporary staffing to cut cost
New Delhi: In the past, temporary staffing was considered only for the low-level positions of a company. But, current days witness a change from that trend as firms now focus on temporary hiring than permanent appointments to reduce cost during tough times, reported The Economic Times.

Retailers, business process outsourcing providers and project-led organizations and industries have already started focusing on contract staffing, while new sectors such as energy, healthcare and pharmaceuticals are all set to hire contract employees with specialized skills and for managerial roles.

According to recruitment firms, temporary appointments are being recognized in difficult economic times as a good option for financially-smart companies, helping them take on more time-based assignments while reducing the cost of permanent hiring. Firms see temporary employees as cost-effective as they don't require giving benefits that they offer to permanent staff normally. The companies can also alter the size of its workforce depending on business needs.

TeamLease, a Bangalore-based temporary staffing firm says it has seen a 20-25 percent increase in demand for temps from industries such as energy and healthcare, while Chennai-based Ma Foi put the growth at up to 15 percent.

Though temporary hiring is a well established model globally, there is a perception in India that temping is mainly for low skill positions. However, staffing providers opine that the mandate of job descriptions and salaries leads them to believe that the silver lining in the job market is the rise and recognition of the model.

"It is almost like an awakening," says Rajiv Mehrotra, Country General Manager, Kelly Services India. And new sectors hiring temps have also raised the quality bar.

E Balaji, CEO of Ma Foi Management Consultants pointed out, "We see this more because several companies now want people with specialized knowledge even when it comes to temps." This is happening across sectors and not just those hit by the global slowdown.

Prabir Jha, global HR head at pharmaceutical company Dr Reddy's Lab mentioned that while temping is more common at the junior level, they have a few consultants at senior levels as temp staffers.

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