FM Sitharaman's jobs push in Budget 2024 will help formalise the workforce, says Team Lease

The progressive shift towards EVs and the associated battery swapping infrastructure, electronics, renewable energy are among the key industries that are expected to see robust growth going forward

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26 Aug, 2025 12:21

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More government schemes for the first-time job seekers will result in greater formalisation of the workforce, according to staffing and recruitment company Team Lease Services.

Ramani Dathi, the Chief Financial Officer of the company told CNBC-TV18 in a conversation that the company has been facing challenges in formalisation of jobs, as it competes with the unorganised sector. "In our case, a significant part of the CTC salary is going into statutory compensations like PF, ESIC etc," Dathi said, adding that this has been the big differentiator between them and the informal hiring. The market share of organised players like Team Lease is less than 5 percent of the overall contract jobs market, she said.

Government schemes are aiming to create more employment through the formalisation route, and has been trying to make it attractive for the first-time job seekers, Ramani Dathi said.

FM Sitharaman has unveiled three employment-linked incentive schemes in the Union Budget presented on July 23.

Team Lease said the next major and much-awaited step would be the notification of the labour codes, which have already been approved by the Parliament. "This will be a gentle sunrise in the formalisation of jobs", TeamLease CFO said.

The staffing industry has so far had low market penetration, but the company is confident of reforms that will aid the formalisation and expansion of staffing firms. Team Lease quoted its Managing Director & CEO, Ashok Reddy, in the 2023 annual report who said, "As the government strives to liberalize and formalize the labour market, we believe, we will be among the biggest direct beneficiaries of this development."

The progressive shift towards EVs and the associated battery swapping infrastructure, electronics, renewable energy are among the key industries that are expected to see robust growth going forward, the company has said. "Formalization of the workforce in FMCG and FMCD supply chains, the manufacturing of EVs and batteries, and the surge in electronics manufacturing due to the introduction of the PLI scheme are anticipated to introduce sectoral changes that will create livelihood opportunities across industries," it added.

Along with the push for employment-related programmes, the allocation to production-linked incentive (PLI) schemes in the Budget rose to nearly Rs 12,500 crore in FY25 from just under Rs 7,000 crore spent in the previous fiscal.