India Inc isn’t hiring as much as it used to.
The pace of growth in net white collar employment has almost halved in 2023-24 from five years back. An ET study of the Sensex companies-30 in total-showed such jobs grew 4.4% YoY in FY24 compared to 8.4% in FY19.
This includes permanent jobs as well as those on long- and fixed-term contracts, and third-party rolls, data collated from the annual reports showed. HR analysts pointed to the stress in tech and consumer sectors as reasons for the slowdown while India Inc executives see the slower growth affecting consumption recovery.
“The tech industry has been going through a rough patch for the past 12-15 months after the Covid period boom. Even the consumer sector has been a bit slow. All these are reflected in the employment generation trend,” said Shiv Agrawal, managing director at ABC Consultants, an executive search and talent advisory firm. He said the mix of permanent and contractual jobs in India Inc has not changed much in the last five years.
Packaged food company Parle Products’ vice president Mayank Shah said job creation is the single most important factor for consumer demand generation. “There is a direct correlation and the stress in job creation in sectors like IT does have a bearing on consumption recovery,” he said.
On a standalone company basis, the data showed net employment has fallen in six companies including Infosys, SBI, HCL Technologies, Tata Motors, Titan Company and Ultratech Cement in FY24 over FY23.
In Infosys, the permanent employee count has fallen by almost 26,000 YoY to 317,240 in FY24. At HCL Technologies, Tata Motors and Ultratech Cement, permanent employee count went up in FY24 over the previous year, but overall employee count fell due to reduction in “other than permanent” jobs that are on contracts and third-party rolls.
At a consolidated group level across businesses, Reliance Industries alone has seen a reduction of 42,000 in employee count in FY24 over the previous year led by the retail business where over 38,000 jobs were slashed. In FY24, it on-boarded over 171,000 new recruits across businesses, almost half of the about 90,000 people it had hired in FY23. Tata Consultancy Services and Wipro, too, saw a drop in total consolidated employee count by 13,249 and 23,257, respectively, in FY24 over FY23. Wipro is not on the Sensex list.
To be sure, the latest government data has shown a fall in overall unemployment rate in India. The recently tabled economic survey for 2023-24 said net payroll additions under EPFO have more-than-doubled in the past five years, signalling healthy growth in formal employment.
Britannia Industries MD Varun Berry told analysts earlier this month that rural growth in FMCG sales — which has been lagging urban for some time–is starting to come back due to better monsoons and moderate inflationary conditions and employment.
