Budget 2024: 80% flexi workers earn Rs 20,000 a month, shows Eco Survey

Budget 2024: India employs nearly 5.4 million formal contract staff or flexi workers through organised contract/temporary staffing companies, according to Economic Survey 2024

Budget 2024: Finance Minister Nirmala Sitharaman on Monday presented the Economic Survey 2024 in Parliament, marking the start of the much-awaited Budget session. The Survey highlights a notable increase in entry-level job creation in tier-2 and tier-3 cities, spurred by the ongoing high demand for job flexibility. This trend includes part-time work for students entering the job market or serving as a buffer during temporary unemployment.

About 80% of flexi workers are aged 21-30, earning an average salary of Rs 20,000-22,000 a month, the Economic Survey showed.

What is the Economic Survey?

The Economic Survey is a crucial pre-Budget report, traditionally released a day before the Union Budget presentation. It offers a detailed analysis of the current state of the economy, highlighting key trends, challenges, and policy recommendations.

 

What is a flexible workforce?

A flexible workforce allows employees to choose how and when they complete their tasks. Examples include work from home, flextime, shift swapping, and annualised hours. This practice helps companies maximise workers' capabilities and increase productivity.

How does the flexi job market look in India?

India employs nearly 5.4 million formal contract staff or flexi workers through organised contract/temporary staffing companies. According to the Economic Survey 2024, these companies ensure timely salary payouts, social security, and medical insurance for their contract staff. Despite working on contracts, these workers enjoy full social security, with more than 75% of contracts in 2023 lasting over six months.

The flexi workforce has grown at a CAGR of 13.2% in the decade ending 2023, maintaining positive growth even during the Covid pandemic. However, flexi jobs constitute only about 1% of the total workforce in India, compared to 2.2% in Europe and the Asia Pacific.

Who makes up the flexi workforce?

About 80% of flexi workers are aged 21-30, earning an average salary of Rs 20,000-22,000 a month. Most flexi jobs in India are at the lower end of the skill spectrum, such as data operations, accounts, sales, back-end operations, administration, and marketing. Nearly 60% of flexi jobs are in sectors like logistics, infrastructure/construction & energy, BFSI, IT, and IT Enabled Services.

Examples of flexible work arrangements

1. Work-from-home arrangements

   These allow workers to manage their work around other life aspects. Collaboration happens via online platforms like Skype or Zoom, saving time on commutes and allowing for more productivity.

2. Flextime

   This arrangement lets workers choose their ideal working hours, selecting the start and end of their workday and breaks according to company policy.

What are the benefits of a flexi workforce?

For freshers/first-time job seekers: Provides their first formal employment.

Transition from informal to formal employment: With social security, employment mobilisation, skills development, and wage protection.

Upskilling and reskilling: On-the-job training allows job seekers to showcase their performance and gain permanent employment.

Women workforce participation: Improved engagement through flexi staffing companies.

What needs to be done for the flexi workforce?

"The government must introduce a comprehensive legal framework specifically addressing the needs of flexi workers, covering aspects like job security, minimum wages, and social security benefits," Jidesh Kumar, Managing Partner, King Stubb & Kasiva, Advocates and Attorneys told Business Standard.

He added, "The government must develop standardised contract guidelines to ensure fair terms and prevent exploitation. Additionally, access to affordable health insurance schemes for flexi workers should be provided. Implementing pension schemes or contributing to the Employees' Provident Fund (EPF) for flexi workers can secure their retirement savings. Offering maternity and paternity leave benefits is also important to support their family responsibilities."

What's next with the Union Budget 2024-25?

Finance Minister Sitharaman will present the Union Budget for 2024-25 in the Lok Sabha on July 23. This is the first Budget of the Modi Government since the NDA returned to power for a third straight term. The Budget for the Union Territory of Jammu and Kashmir for 2024 will also be presented on the same day.