Sector-wise recruitment activity fluctuating between high and low
Recruitment company mirrors the state of affairs of Indian economy in many ways. Therefore, the third quarter performance of Info Edge (which operates recruitment platform- Naukri.com) can be considered as an index to the performance of various sectors.
Recruitment company mirrors the state of affairs of Indian economy in many ways. Therefore, the third quarter performance of Info Edge (which operates recruitment platform- Naukri.com) can be considered as an index to the performance of various sectors. Data points emerging from the company’s recruitment arm shows that IT sector hiring is now normalising after two years. The company also indicated that attrition remains high in many IT companies and is likely to come down in the coming quarters. Therefore, billing is expected to normalise in coming months.
It added that IT firms are delaying decisions with regard to adding headcount. However, taking reference from the mass layoffs by US-based technology giants, it concluded that it would create opportunities for the Indian IT services sector as more work are likely to be outsourced to offshore locations like India. Therefore, the commentary of the Info Edge management mirrors the sentiments of the Indian IT industry. Sources in the know said that lateral hiring has been limited to need-based with many companies going slow on fresher onboarding. Even reports suggest that many freshers were not able to join their final projects in some of the major firms including Infosys and Wipro as they were not able to clear the final tests. It reflects that companies have slowly raised the bar for new recruits after training. Similarly, all data points indicate that attrition is on a decline after eight quarters of elevated levels.
While the Indian IT sector will go slow on hiring in 2023, recruitment activity in non-IT sectors remains robust. The company said the government’s push on infra-related spending may bring in non-IT jobs back in the market. As long as India grows at six per cent, it will help the company to grow its recruitment business. Its real estate portal, 99acres has seen increasing activity in all three categories- rental, re-sale and new projects. It, however, indicated that rising interest rates may impede the growth prospects of real estate industry.
Hiring in India seems to be going through a transition. While some sectors are witnessing a slowdown after two years of hyper-growth, others are seeing a steady rise. Technology and other related sectors like tech-oriented startups have seen rapid rise in headcount during the pandemic. As growth normalises, these segments are in a cost optimisation mode. On the other hand, sectors like real estate, retail, FMCG, travel and others, which had seen negative growth during the pandemic, are reporting steady recovery. On that count, 2023 will be a mixed year in terms of hiring and headcount addition. As the global economy stares at a slowdown, some impact will be seen on the export-oriented sectors. The initial glimpses of this phenomenon are already visible. In some way, such rebalancing is healthy for Indian economy as it cools up demand in the labour market and lowers wage cost. As unusual rise in wage cost doesn’t support growth in any developing economy; a steady balance is more desirable for sustainable growth.