Gig jobs are eating into the permanent jobs pie of the IT sector. The result: the pace of hiring for permanent roles across IT firms is slowing down.

According to CIEL HR Services research shared exclusively with ET, permanent jobs have grown by less than 5% in 2023 vs 2022 while the number of gig workers has increased by 40%. Amid an uncertain business environment, engaging gig workers offers greater flexibility to these companies, as they can hire them on an as-needed basis without the commitments associated with permanent employees.

In 2023, six out of every 10 companies are hiring gig workers, compared with just two last year, according to CIEL research of more than 100 IT services providers.

“Slowdown in the tech industry has accelerated the adoption of the gig workforce,” CIEL HR chief executive Aditya Mishra said. More and more Indian IT players are now adopting a blended workforce strategy: blending permanent and contractual workforce with gig workers.

Seeing the expansion of the gig workforce, the government is pushing for more policies to safeguard their interests, a government official said. Several policies are in the works to cover this workforce, including on minimum wages, working hours, social security contributions, grievance redressal mechanisms and dispute resolution, the official told ET.

“The emergence of the gig economy, coupled with the impact of the pandemic, has shed light on this segment of workers who played a vital role in ensuring the delivery of goods and services to the last mile,” said Atul Kumar Tiwari, secretary at the Ministry of Skills Development and Entrepreneurship.

The government is actively engaged in conducting research to better understand the gig economy and its impact on workers, said Tiwari.

Most of the leading IT services companies, including Tata Consultancy Services, Infosys and Tech Mahindra, either already have a gig hiring platform in place or are allowing employees to take up external gig jobs (after getting their manager’s approval).

“Gig work or crowdsourcing platforms can be well-leveraged within enterprises to get access to talent pool, offer them the right opportunities and enhance their skills,” said Manoj Shikarkhane, chief human resources officer, LTIMindtree, which has launched such a platform, called ‘GigSpace’.

“In the current times, a healthy balance between full-time employees and gig workers enables organisations to thrive in good stead and helps in management of talent scarcity and operational efficiency,” said Shikarkhane.

Tech Mahindra currently uses an artificial intelligence-based talent marketplace, Talex, to identify gig workers internally. It has also built an external marketplace called BeGig. It enables employers to tap into the freelance workforce and hire the appropriate and requisite talent.

“We are also leveraging the gig workforce, as talent can be found anywhere. New positions are filled based on ‘best-fit’ talent to deliver outcomes without any location constraints,” said Harshvendra Soin, global chief people officer & head of marketing, Tech Mahindra.

According to Adecco India director AR Ramesh, the overall IT services jobs market has dipped by 70%. “This decline in the proportion of regular wage and salaried workers is mostly offset by an increase in contract and gig employment,” said Ramesh.

The per-day pay for a gig worker in the IT domain has increased sharply from Rs 6,500 in 2020 to Rs 8,000 in 2022, according to Flexing It, a gig work platform. “We see nearly 50% growth over the past 12 months in the number of consultants registering from the IT industry,” said Chandrika Pasricha, founder and CEO, Flexing It.

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