NEW DELHI/BENGALURU: With the ongoing coronavirus pandemic threatening to stall economic growth, virtually all industries are hit hard, triggering a sharp pullback in hiring and a significant number of layoffs.
While the shockwave was felt first by the likes of aviation, retail, tourism and hospitality, white-collar workers in the technology and other services sectors are now feeling the heat. Data from staffing firm CIEL HR Services shows that hiring is down by 60 per cent across sectors.
“Retail, hospitality, logistics, manufacturing and construction are among the worst-hit as businesses shutter to contain the spread of the Covid-19,” said its CEO Aditya Mishra.
Conversely, a surge of jobs are opening up with e-grocers, warehouses as well as the healthcare services industry hunting for employees to meet the increased demands caused by the virus.
But most of these are temporary employment and for low wages, ergo they will not be able to offset the vast layoffs we are seeing at small businesses.
Headhunters say the actual job losses in the formal sector will be seen only in the April-June period since most companies aren’t resorting to immediate staff retrenchment, given the sensitivity of the pandemic.
HeadHunters India CEO Kris Laxmikanth told TNIE that globally, new recruitments are taking place if the CFO sanctions them and that there is a likelihood of US-based MNCs even going for 20-25 per cent wage cuts to mitigate the effects of coronavirus on their revenues. Unemployment claims, however, have multiplied to reach an all-time high of 200 million in March, which experts say will climb further if the nationwide lockdown is extended beyond April 15.
According to technology consulting firm Zinnov, 45 per cent of multinationals present in India, also known as Global In-house Centers (GICs), have paused all further hiring. Currently, there are 1,200 GICs in India generating revenue of $28 billion annually and employing close to a million people. A Zinnov report said that 25 per cent of the enterprises have either deferred their appraisal cycle or reduced salary budgets.
The IT/ITes sector has also seen 40 per cent drop in hiring across all levels with many placing some of their existing staff on furlough. Even CXO level hiring — typically the last in the list to face the axe as companies can’t hold off hiring for critical roles such as operations and finance — has been put on hold.
In terms of campus hires too, the date of joining has been delayed for those expected to join in April, said Rituparna Chakraborty, co-founder and executive vice-president of TeamLease Services. “Keeping the financial prudence in mind, organisations are not willing to invest in high cost resources till they have more clarity on the way forward,” she added.