India Flexi Workforce to Reach 9.16 Mn by FY27

New Delhi, Sep 18 (PTI) India's formal flexi workforce has witnessed a significant increase in the overall workforce and is anticipated to grow from 7.23 million this year to 9.16 million in 2027, indicating that flexi arrangements are increasingly outpacing traditional employment models.

According to a study, 'Indian Flexi Staffing Industry 2025: Employment Growth - Sectoral & State Analysis', the formal flexi-staffing market is expected to reach Rs 2.20 lakh crore in FY26.

Flexi hiring allows businesses to adapt swiftly to changing demands and focus on core activities, while reducing compliance liabilities, quick access to talent with an important factor being workforce flexibility and scalability.

"India's flexi workforce, under the tripartite model, has surged from 5.7 million in FY23 to 7.23 million in FY25, reflecting a robust compound annual growth rate (CAGR) of 12.6 per cent over the next two years. By FY27, we anticipate this figure to reach 9.16 million, with penetration in the overall workforce climbing to 1.6 per cent," said Lohit Bhatia, President, Indian Staffing Federation.

This acceleration, post-COVID, underscores a 15.7 per cent year-on-year growth, driven by economic recovery, digital transformation, and policy reforms that encourage formalisation.

Globally, India ranks third in flexi headcount, trailing only China and the United States.

Geographically, a significant portion of the formal contract workforce is concentrated in five key states - Maharashtra, Karnataka, Uttar Pradesh, Tamil Nadu, and Telangana.

"The emerging growth in Tier 2 and 3 cities is particularly encouraging, as it signifies a deepening of formal employment, offering temporary workers the security of recognised employment, fair compensation, annual benefits, and health benefits," Bhatia said.

In terms of sectors, logistics, BFSI, and manufacturing account for approximately 38 per cent of the total formal contract workforce in India.

The shift towards a more flexi workforce in the next five years will be driven by several key factors. Industries such as e-commerce, retail, and hospitality experience significant demand surges during peak seasons, such as festive sales, which necessitates a temporary increase in staff.

At the same time, rapid industrialisation and growth in sectors like IT, retail, e-commerce, and manufacturing are creating a sustained demand for workers.

To address these needs efficiently, companies are increasingly hiring temporary staff to manage short-term projects and seasonal workloads, making a strong case for the wider adoption of formal flexi work models.