For nine years, Devesh Upadhyaya saw his job placement firm, Noida-based iQuest Consultants, grow from strength to strength.
Then came the economic slowdown, whose symptoms were the collapse of iconic names like Bear Stearns and Lehman Brothers in the US.
Companies didn’t want to hire anymore, several of Upadhyaya’s clients delayed payments, his revenue went down 35-40 per cent and he had to downsize, reducing the number of his recruiters from 120 to 70.
However, for the first time in a year, hiring is looking up across sectors such as information technology, pharmaceuticals and real estate, among others.
Upadhyaya’s firm has begun to reap the benefits of the upturn in hiring.
The economic slowdown in India over the past one year caused a hiring freeze in several companies, and downsizing. However, in the past few months, recruitment seems to have picked up across several sectors, with the economy expected to grow at more than 6 per cent in 2009-10, and industry growing 9.1 per cent in September 2009.
Advanced economies of the West are coming out of the worst recession since the Great Depression of the 1930s.
“We seem to be getting back to the good old days,” said Upadhyaya, director, iQuest.
“Since September this year hiring has increased by 30 per cent at iQuest (over August 2009) and in October we had to hire 20 recruiters to deal with the increase in workload.”
Job portal naukri.com’s monthly “jobspeak index” for September showed that hiring activity increased by 4.1 per cent in September over August. The report says that ITES (information technology enabled services)/BPO and real estate companies showed most promise and their hiring grew by 18.3 per cent and 36.8 per cent, respectively, over August.
“The good news is that the IT and BPO sectors, which are big employers especially at entry and junior levels, seem to be in positive territory after a long time,” said Hitesh Oberoi, chief operating officer, Info Edge, the company that owns naukri.com.
“Hiring in some sectors such as IT, ITES and pharmaceuticals has increased by 30-40 per cent in the last 7-8 months,” said Pramod Thilakan, executive director, Executive Recruiters' Association. “They are recruiting freshers as well as mid-level executives.”
Once key sectors such as IT recover, the services industry and retail too will start looking up, said Thilkan.
American global staffing firm Manpower in its employment outlook report for the October-December 2009 quarter has said that India has the best hiring prospects out of 35 countries surveyed. The report looks at the hiring plans of the recruiters across various industries.
Indian staffing firm TeamLease Services in its employment outlook report for the July-September quarter had predicted an improvement in India’s net employment outlook for the first time in one year. The firm in its October-December report predicts India’s net employment outlook and net business outlook will be brighter in coming months for almost all sectors except retail, the media and FMCG.
“The outlook is positive and demand is certainly increasing,” said Manish Sabharwal, chairman, TeamLease. “Other than healthcare, insurance and hospitality, there is a lot of activity happening in private education too.”
Industry leaders claim that they are considering hiring for the first time since the economy went into a slowdown.
“Our lateral hiring had taken a hit during the downturn, slowing down by 87 per cent between October and December 2008,” said Anita Gupta, vice-president (human resources, India), Aricent, an American technology and services company.
“But we are hiring now. We have already hired 1,000 people and by March 2010 we plan to add another 500-700 to our workforce.”
Many companies had to put their recruitments on hold not only because they were downsizing but also because they saw several of their projects getting delayed due to the downturn.
India’s leading retailer Pantaloon Retail had to postpone its plans to start new stores because it didn’t get some of the properties in time because of the slowdown in the real estate industry.
“This year we plan to add around 4 million square feet of space to our stores and accordingly around 4,000 front desk jobs plus whatever other hires are required will be done,” said Atul Takle, spokesperson, Pantaloon Retail, India.
However, the recruitments are far from robust yet.
“Though hiring has increased, it is still cautious and it will be another six months before it picks up pace,” said Sabharwal. “Consumption in India has improved but exports, which are linked to the recovery of foreign markets, will take
time to pick up.”
Most companies are trying to keep in mind the hard lessons they learnt from the economic slowdown and are also trying to introduce some changes in the hiring procedure.
“The meltdown taught us to have a hard re-look at all existing processes with a view to optimising or clubbing certain activities,” said Navin M. Raheja, chairman and managing director of real estate company Raheja Developers.
One of the changes Aricent has brought about in its recruitment procedure is to do only 10 per cent of the hiring, against
the earlier 30-40 per cent, through job placement consultants.
“Only for senior positions with strict job specifications do we now turn to outside consultants,” said Gupta. “We have started using online communities such as LinkedIn, Facebook and Orkut to find talent.”
“Once big, western economies begin recovering they will outsource more functions to India, perhaps more than the pre-recession levels,” said Thilakan. “That will lead to the real hiring boom in India.”
tracking the recovery
* There is an improvement in the employment prospects of all sectors except retail, media & FMCG, infrastructure, manufacturing & engineering, and telecom.
* Financial services were best-placed, followed by health care
* There is an increase in the job situation of all cities except Delhi, Bangalore and Chennai. Hyderabad improved the most in this respect
* During the past three months as well as the last one year, Hyderabad, Chennai and Bangalore had the highest attrition rates compared to other cities.
* Kolkata had the lowest attrition rate in the last three months and last one year