Hiring is slowing, but these sectors are still creating formal jobs

The IT flexi staffing segment grew 2% sequentially and 7% year-on-year in Q1 FY27, report mentioned.organised staffing was helping bridge the gap between informal and formal employment while creating a more transparent and compliant workforce, says expert. New Delhi,Oct 6, 2026 15:44 ISTIndia’s job market may be showing signs of slowing, but flexible hiring is still holding up. Staffing firms added more formal jobs in the April-June quarter, with demand coming from technology, manufacturing and consumer-facing businesses.The formal flexi workforce grew 2.6% quarter-on-quarter in Q1 FY27 and 7.5% year-on-year, according to the latest Flexi Staffing Employment Trends Report released by the Indian Staffing Federation (ISF) on Tuesday.Over the past 12 months, ISF members added 1.14 lakh new formal flexi jobs, taking the formal contract workforce to 1.95 million in the June quarter.Flexi staffing refers to hiring workers on a flexible basis, such as fixed-term contracts, temporary assignments, project-based roles or on-demand work. A staffing partner typically handles recruitment, payroll and compliance, while businesses get the workforce they need without making a long-term commitment. IT STAFFING LEADS THE GROWTHTechnology continued to be one of the strongest areas of hiring through staffing firms.The IT flexi staffing segment grew 2% sequentially and 7% year-on-year in Q1 FY27. The growth was supported by rising demand for digital services, artificial intelligence and machine learning, along with the continued expansion of Global Capability Centres (GCCs). Farhan Azmi, Vice President, ISF, said the performance of IT staffing showed that demand for digital transformation remained strong despite wider global uncertainties.“Continued expansion of GCCs and significant investment in areas like AI/ML, and digital services are the primary engines for this growth,” he said.MANUFACTURING, CONSUMER SECTORS DRIVE HIRINGThe demand for flexible workers was not limited to technology.According to the ISF report, manufacturing and consumer-facing sectors also contributed to employment growth during the quarter. Capital investments, infrastructure projects and new plant commissioning created demand for project-based workers.The growth came despite geopolitical tensions in West Asia and rising crude oil prices. The report noted that India's real GDP grew 7.8%, providing support to demand for flexible manpower.STAFFING FIRMS HELP YOUNG WORKERS ENTER FORMAL JOBSThe staffing industry is also becoming an important entry point for young people joining the organised workforce.Manmeet Singh, President of ISF, said flexi staffing continues to act as a bridge for young, first-time jobseekers entering formal employment.Nearly 57%-61% of new EPFO subscribers are aged 18-25, he said, highlighting the role of organised staffing in bringing younger workers into the formal economy.“Organised staffing accelerates India's workforce formalisation by ensuring young talent gets direct access to statutory protections, social security, health coverage, and structured skilling,” Singh said.FORMAL FLEXI WORKFORCE REACHES 1.95 MILLIONThe formal contract workforce among ISF members stood at 1.95 million in Q1 FY27.Suchita Dutta, Executive Director of ISF, said the addition of 1.14 lakh formal flexi jobs over the past year reflected the resilience of the staffing industry.She said organised staffing was helping bridge the gap between informal and formal employment while creating a more transparent and compliant workforce.Overall, the latest data shows that while formal employment growth is gradually moderating, demand for flexible workers remains firm, particularly in technology, GCCs, manufacturing and consumer-driven sectors.- Ends