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Share of contract workers in various sectors
Mar 21, 2014


As per a survey in Live Mint, among the country's top listed companies, contract employees account for 34% of the total workforce. The sample comprises of country's 82 listed firms that account for 64% share of market capitalization and 46% of the revenues. The companies have been further divided into service and industry categories. While the former comprises of sectors like software, finance and telecom, the latter comprises of cement, auto, energy sector etc.

So, here are the findings. The contract workers account for 46% share in the industry and 8.8% share in the service category. Within the service sector, while financial and software services rely on regular employees, telecom's share of contract employees stands at around 46%. For industries, because of lesser need of specialized skills and regulations and labor intensive laws, the ratio is much higher. The industries that lead in using contract employees are energy and utilities with 53.5% share, followed by cement with 52.1% share. Sectors like pharmaceuticals and metals and mining count more on regular employees, with just 23% and 28% share of contract labour respectively.

While the companies may have found temporary solutions by relying on contract labor, the practice adversely impacts employers' investment in human capital and deprives organizations of rich experience of long term regular employees. It also does not guarantee job security for the employees. It's time that the Government relaxes labour laws and creates a long term win-win situation for all.

Data source: Business Standard
*CG = Consumer Goods

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