Shift in Corporate Hiring Trends: 17% of Employees Now Temporary; Women’s Participation Declines

In the 2026 financial year, the share of temporary employees in the total workforce of companies has risen to 17 percent. Just three years earlier, in the 2023 financial year, this figure stood at 11 percent.

Non-Permanent Employment Data: A significant transformation is underway in how the Indian corporate sector operates and hires staff. A recent analysis of the annual reports of 353 major BSE 500 companies has revealed striking figures. In the 2026 financial year, the share of temporary employees in the total workforce of these companies reached 17 percent—a notable increase from the 11 percent recorded in the 2023 financial year.

Driven by factors such as volatile demand, shifts caused by artificial intelligence, geopolitical tensions, and rising operational costs, companies are increasingly prioritizing flexibility over offering long-term, permanent employment. These temporary workers—comprising fixed-term employees, third-party contract workers, and gig workers—are distinct from a company’s regular, permanent staff.

According to experts and industry reports, several factors are driving the increase in temporary hiring. The primary drivers are rising costs and shrinking profit margins. In fact, the total operational costs for domestic companies are currently at a three-year high; in the September quarter, these costs surged by 22% year-on-year.

Meanwhile, excluding banks and oil companies, the net profit margin for the corporate sector has fallen to 11.9 percent—below the four-year average of 12.2 percent. According to Suchita Dutta, Executive Director of the Indian Staffing Federation, when profit margins come under pressure, companies often look to cut back on permanent employment commitments first.

Another major factor is the ease with which these workers can be onboarded or offboarded. According to Atul Gupta, a partner at Trilegal, temporary or contract workers can be hired quickly when the need arises and can be let go—once the work is completed or business requirements decrease—without the need for lengthy legal procedures. Furthermore, the new labour codes have also had an impact; they impose certain restrictions on the use of contract labour for core business activities. Companies are currently in the process of evaluating which tasks constitute 'core functions' and which do not.

Perhaps the most concerning aspect of this report relates to the participation of female employees. According to the findings, the share of women in the total workforce of BSE 500 companies declined from approximately 33% in the 2025 financial year to 31.5% in the 2026 financial year. Conversely, the share of women in temporary employment rose from 9.7% in the 2023 financial year to 12% in the 2024 financial year, reaching approximately 13% by the 2026 financial year.

Experts suggest that companies have become more cautious about hiring women for permanent roles due to the compliance costs associated with such positions—including maternity benefits, extended leave, the provision of crèche (daycare) facilities, and the arrangement of safe transport for night shifts. Additionally, the phasing out of 'work-from-home' arrangements following the COVID-19 pandemic has also contributed to the decline in female workforce participation.