How Did India's Flexi Staffing Industry Grow 6.1% in Q1 FY26?
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Synopsis
India's flexi staffing industry is witnessing significant growth, particularly in the IT sector. With a year-on-year increase of 6.1%, the industry reflects a transformation in employment patterns. Discover the factors behind this growth and what it means for the future of work in India.
Key Takeaways
- Flexi staffing industry sees 6.1% YoY growth in Q1 FY26.
- IT segment leads with a robust 12.3% YoY increase.
- Overall flexi staffing growth is tempered by economic challenges.
- 91,500 formal positions created in the last year.
- Total flexi workforce reaches 1.83 million.
New Delhi, Oct 7 (NationPress) The flexi staffing sector in India experienced a growth of 6.1 percent year-on-year during Q1 FY26, primarily fueled by strong performance in the IT staffing domain, as per a report released on Tuesday.
The overall flexi staffing market saw a quarter-on-quarter increase of 1.5 percent in Q1 FY26 compared to Q4 FY25. Notably, the general flexi segment, excluding IT, recorded a 1.4 percent QoQ growth, according to the Indian Staffing Federation's report.
Demand from critical sectors like FMCG, e-commerce, retail, logistics, and manufacturing continued to bolster employment figures, although the pace was moderated by a phase of consolidation and postponed hiring decisions, the industry body added.
The IT flexi staffing segment showcased exceptional performance, achieving a significant 5.5 percent QoQ growth and a remarkable 12.3 percent YoY increase, the report highlighted.
This substantial growth indicates a robust revival in specialized technology needs, driven by heightened demand for AI, cloud, and digital services, along with the expansion of Global Capability Centres (GCCs).
“The results of Q1 FY26 reflect a transformation in formal employment growth, demonstrated by a slowdown in flexi employment growth to 6.1 percent YoY — marking the slowest Q1 growth since the pandemic in 2020. This moderation is mainly due to challenging economic conditions and reduced consumer spending, which have impacted overall hiring trends,” stated Lohit Bhatia, President of the Indian Staffing Federation.
The IT staffing segment maintained strong momentum, achieving a 5.5 percent QoQ rise. This trend, characterized by a 12.3 percent YoY growth, emphasizes the non-cyclical nature of demand for digital transformation, noted Manmeet Singh, Vice President of the Indian Staffing Federation (ISF).
ISF reported that its members created 91,500 formal jobs in the past year, raising the total number of formal flexi employees to approximately 1.83 million by the end of Q1 FY26.
Point of View
Our national perspective underscores the significance of the flexi staffing growth in India. The reported figures indicate a shift in employment dynamics, revealing both opportunities and challenges in the labor market. Monitoring these trends is essential for stakeholders to adapt effectively.
NationPress
07/10/2025
Frequently Asked Questions
What sectors are driving the growth in flexi staffing?
Key sectors driving flexi staffing growth include FMCG, e-commerce, retail, logistics, and manufacturing.
How much did the IT flexi staffing segment grow?
The IT flexi staffing segment achieved a remarkable 12.3% year-on-year growth in Q1 FY26.
What challenges are affecting flexi staffing growth?
Challenges include economic conditions and reduced consumer spending, leading to a slowdown in hiring.
