eNewsletter

Foreign companies will face increasing challenges retaining long-term employees in India.  The statistics provided by the Indian government show an emerging trend in the Indian workforce – the drastic rise of casual workers.  
The labor force in India can be broadly divided into: 1. self-employed, 2. salaried employees, and 3. casual workers.  Casual workers are employees who do not enjoy the same benefits and security as tenured employees.  All daily wage employees and some categories of contract employees are considered casual laborers. 
The survey, released on June 24, 2011, reflect, on one hand, the growth of the number of casual workers (workers on a temporary employment contract) by about 21.9 million between 2005 and 2010 from 410 million to 431.9 million. There are significantly more temporary workers today than there were 5 years ago.  On the other hand, there are only 5.8 million more regular workers in 2011 – half the number of previous years.  The number of the self-employed also declined by about 25.1 million.  Currently of the 1.3 billion Indian population, about 51% of India’s total workforce is self-employed, 35.5% is casual laborers, and only 15.6% is regular wagers or salaried employees.  
Extensive labor laws discourage hiring casual workers, leaving many foreign companies understaffed.  The world of work for employees has changed from stable and long-lasting to short and volatile.  However, well-educated white collar Indian workers are still in high demand.