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India’s biggest staffing firm flags large labour market shifts

More Indians are leaving their farms and villages for urban jobs, according to the nation’s biggest staffing company, a shift that would change the nature of the world’s fifth-largest economy. 

Workers would now be eligible for contracts that contain social security benefits, Ajit Isaac, chairman of Quess Corp., said in an interview with Bloomberg Television’s Rishaad Salamat and Juliette Saly. Demand for services will increase while manufacturing will decline as productivity improves, he added.

“There are structural changes taking place in India’s labor market,” Isaac said. “For overseas companies coming to make an investment in India, it’s good for them to calibrate some of these into their business plans.” 

The underlying shifts pose both an opportunity and challenge for Prime Minister Narendra Modi’s government. Agriculture employs about half of India’s 1.4 billion population but accounts for only 18% of economic output, which means policy makers will have to create jobs for the migrants that in turn could boost growth and tax revenues.

Quess, which lost about a quarter of its 380,000-strong workforce during the pandemic, has since seen numbers swell to about 480,000. The company helps in hiring staff across processes including manufacturing, marketing, customer care, technology.

Isaac also sees disposable income rising for Indian workers next year as labor costs are expected to rise “in double digits” while inflation will ease.

“Data seems to suggest that the worst is over for India in terms of unemployment,” he said.

This story has been published from a wire agency feed without modifications to the text.

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