By Denis Pennel for staffingamericalatina

The Ciett World Employment Conference in Delhi last month was an energising experience and along with many of the delegates I returned home with renewed motivation. India is becoming one of the most important contributors to global employment and, while it faces both opportunities and challenges, in many ways the country provides a perfect showcase for the future of our industry.

With a stable and buoyant economy, delivering some 7% year- on-year growth, India has unlimited potential in terms of talents and skills. The country offers good opportunities for businesses all over the world and, with its increasingly solid infrastructures and booming tech hubs, it is enjoying on-going job creation. Cities such as Bangalore and Chennai are home to large, global enterprises which are taking advantage of this positive business environment to establish bases and shared service centres.

However, with a workforce of some 270 million people, India is also a player on a global scale. Not only is the workforce large, but it is young, and grows by one million young people every month. Aside from its domestic potential, in the years ahead India will also be a major global talent source. It will have a central role to play in labour mobility, particularly by circular migration as workers have the chance to address the demand for both high and low-skilled talent that will occur in Europe and North America mid-century as a result of ageing populations and falling birth rates.

Of course this all points to a significant growth potential for the employment and recruitment industry.  Our industry has already grown by 20% in the past 3 years in India and a new, comprehensive report released by the Indian Staffing Federation (ISF) to coincide with the conference revealed that the country is set to be the third largest market for flexi staff by 2018, employing some 2.9 million workers.  Indian Flexi Staffing Industry research 2016: sectoral and state analysis demonstrates how the flexible staffing industry is currently experiencing growth of over 12% per year and this is forecast to continue in the years ahead.  Flexible staffing is set to become a job-creation engine in India over the next 20 years, adding over nine million young people to the organised workforce.

The ISF report sees the highest contribution to overall flexi staff coming from 11 Indian states and led by Maharashtra, Karntaka, Uttar Pradesh, Tamil Nadu, Delhi and Gujarat.  These states will dominate the formal employment landscape in the years ahead, accounting for some 2.4 million of the country’s 2.9 million flexi workers by 2018. This is particularly good news for young people, entering the employment market.  Traditionally some 40% of agency workers are under 25 years of age and for many of them, private employment agencies offer their first experience of the world of work.   Having given them a foothold in the job market our industry then supports them in making transitions within the labour market, ensuring that they always remain in employment.

Inevitably, along with the opportunities there are structural hurdles that need to be overcome if our industry is to be able to develop fully and to support businesses and workers in realising their potential.  Firstly the regulatory environment needs to be reformed.  It is currently too complex and too bureaucratic.  Reforming and modernising contract labour regulation to bring it in line with the needs of 21^st century business reality would allow for modern, flexible forms of work that also provide adequate security for workers.  Experience from around the world illustrates that when labour markets are appropriately regulated, and strike the right balance between flexibility and security, then this is a driver of jobs and growth.

The second area where reform is needed is in the very high rate of unorganised, informal work in India.  Some 92% of the Indian working population works without a formal labour contract and hence does not enjoy any social benefits or protection.  The private employment industry provides work for the 8% of workers who are within the organised workforce hence there is huge potential for growth.

The ISF report explains that for every 1% of the workforce that is converted to formal work, 1.5million people gain access to social security and to a legal framework that upholds their rights.  Indeed organised flexi staffing companies have made a significant contribution towards social security and government revenues in the past few years and I would urge that a national regulatory framework should be created for the industry.  It would ensure a level playing field and also address the concerns of the trade unions whose primary motivation, quite rightly is to ensure a fair wage and a fair deal for workers.

The conference in Delhi has certainly put our industry on the map and confirmed ISF as the voice of formal employment and staffing in India. I am excited about the future and the potential for our sector to bring millions of worker into the formal labour market, with all the benefits and social protection that this affords.

About Denis Pennel

Managing Director of Ciett and Eurociett, Denis Pennel is a labour market expert with deep knowledge and years of experience relating to employment at global and EU levels. He recently published “Travailler pour soi”, a book about the new realities of work.

Follow Denis on Twitter @PennelDenis

About Ciett

As the International Confederation of Private Employment Services, Ciett is the authoritative voice representing the interests of agency work businesses. Founded in 1967, Ciett consists of 51 national federations of private employment agencies and eight of the largest staffing companies worldwide. Its main objectives are twofold: to help its members conduct their businesses in a legal and regulatory environment that is positive and supportive; to gain recognition for the positive contribution the industry brings to better functioning labour markets.

Follow Ciett on Twitter @ciett_waytowork