Transformation of Human capital is imperative for the survival of business in our every changing and volatile global market. Organisations are compelled to leverage human capital as a critical competitive advantage. Staffing has emerged as a key business enabler with its inherent value proposition of flexibility, scale and cost optimisation. While the evolution of human capital in developed countries is wildly exciting with people talking of uberisation and gig economy, India has some time in hand to play and catch up .The adoption of technology for hiring is not just restricted to usage of mobile phones, there is also a growing acceptance for tech tools like analytics and machine-based hiring. Needless to say India has its own challenges and drivers which are determining the winds of change in Staffing here.
Lets try and assess the key drivers which is expected to the stimulate the change in how the Future of Staffing would look :
Regulatory Transformation: To pursue steady growth and simultaneous formal job creation its clear that we need to step out of the archaic labour regime. Laws which exists to protect the self interest of the minority 6 % who are in the formal workforce, are regressive and hence to fuel entrepreneurship and attract new businesses with the potential to create job amending irrelevant laws, is the need of the hour. Rajasthan Government attempt to break away from history and amending key labour laws using constitution 254(2) signals a change in approach. Rather than the Factory Act amendment led to increase in registration of factories – not so much to indicate create of new businesses but more to suggest coming above radar of erstwhile informal outfits. This augurs well for formal staff augmentation needs.
Demonetisation : A term which we thought was one of those lessons in theories of economics we shall not experience in this lifetime, has overnight become a reality. It has also overnight made cash the least desirable thing to possess or transact in. And that also means that engaging informal labour for short term, periodic, long term contracts below the radar and in cash has become least lucrative option for employers as well as candidate’s alike. This is expected to trigger massive positive movement from informal or casual work to formal staffing.
Implementation of GST for Formal Job Creation – A recent study conducted by TeamLease suggests that with the onset of the GST, as a single, simple and seamless tax stimulating demand, we could witness atleast 11% increase in formal job growth. The predictability of cost of the products manufactured or services rendered across the country would improve enterprise productivity as well as profitability. The network effect of informal businesses pushed to formalize is instrumental in creating formal jobs with organized playing the perfect conduit to making that possible.
Dysfunctional Matching process – The biggest challenge in Staffing today is to connect the right person to the right job without breaking the bank. Cost of acquisition of talent is the biggest cost in any manpower budgeting process and its increasingly becoming the shows stopper. India’s leading job portal hence today have hostages and not clients and is at the receiving end of disproportionate gains at the expense of employers as well as today’s youth. Information asymmetry and lack of unified matching (job) market place being the clear binding constraint. That is precisely the reason on one hand staffing companies have customers who are crying themselves hoarse of not finding the right talent and on the other hand they are able to provide jobs to only 5% of the kids who are walking into their offices for a job. Innovation in matching algorithms is going to determine the future trajectory of Staffing.
Access to new age technology – India is witnessing the zenith of technology renaissance built on the innovation across digital technology, bandwidth quality and distribution and cloud. One hand of the spectrum we find fintech innovation of the likes of Paytm, Mobikwik which is easing the challenges of salary disbursement to the millions of workforce and is addressing the present need of substituting cash, on the other end of the spectrum we are seeing disruptive matching solutions in the form of the Quikr Jobs and Urban Clap. Each of these technology innovations can empower staffing organisations to improve their productivity, achieve economies of scale, just in time hiring and reach.
Machine Hiring – Machine hiring allows companies to avoid judgment errors caused by short attention spans. Gig workforce or a formalised version of freelancing—is toppling hiring models across the world. Choice, flexibility and work-life balance top the considerations for 65% independent workers while lower costs and operational efficiencies are top considerations for 75% employers, according to The New Landscape of Hiring report by Teamlease.
New age hiring tools not only provide answers to age old dilemmas like intuition vs machine based intelligence hiring, but also big data and predictive analysis eliminates human bias and automates the process to enable agile and effective hiring, especially in the SME’s and traditional sectors like manufacturing and engineering.
Staffing in India doesn’t have the challenge of addressable market with a million youth getting added to the workforce every month for the next twenty years and gradual emergence of a favorable labour law landscape. Now its upto us to make ourselves lean, hungry and adaptable to execute with robotic precision to become a force multiplier for the Indian Economy.
About The Author :
Rituparna Chakraborty is the President of Indian Staffing Federation and Cofounder and Excecative Vice President of Teamlease Service Limited. She is Part of the founding team and group leadership. Responsible for Staffing Business and NETAP accounting of TeamLease overall turnover and drives new business initiatives across TeamLease and TeamLease Skill University.
Copyright 2017, Insights Success. All rights reserved.