Namrata Singh| TNN | Dec 9, 2016, 04.00 AM IST
Mumbai: A month after demonetisation was announced, there is sluggishness in hiring with some sectors focusing merely on replacements, if not a complete freeze. Hiring agencies TOI spoke to said companies, especially in the consumer goods sector, are in a wait-and-watch mode and are promoting talent from within till there is clarity on the outcome of demonetisation.
In sectors like fast-moving consumer goods (FMCG), consumer durables and retail, which appear to have been hit the most by demonetisation, Joseph Devasia, MD, Antal International India, said: "Some of our clients have gone on a hiring freeze and have voluntarily asked us to stop working on a few active roles or not to share candidate profiles until further notice."
Based on his interactions with a number of leaders across industries, Ronesh Puri, MD, Executive Access (India), said he sees a temporary postponement in hiring decisions. "While some industries like infrastructure are hopeful of a positive outcome on account of demonetisation, others like FMCG and realty are facing uncertainty, forcing them to put hiring decisions on hold for the moment. This will be temporary for a couple of months, post which corporate India would readjust to the new reality."
Financial infrastructure and the technology space are, however, showing a divergent trend of enhanced hiring. In tech startups, Devasia said none of the roles the firm is working on have gone on hold but the process of hiring has drastically slowed down. "Companies do not seem to be keen on hiring for growth roles, they are not willing to see new profiles. Sales are hit as people are conscious about spending due to cash crunch and this has led to downgrading of results for the coming quarter," said Devasia.
Among management consultancies, Devasia said the firm hasn't seen any role going on hold or a hiring freeze, although "there is a lot of sluggishness within the sector, with line managers taking time to decide on whether to hire or not".
As a result, candidates who have been interviewed and selected are waiting for the offers but haven't heard from clients yet. Experts said there is an atmosphere of uncertainty over how the economy will perform in the next quarter. This would have a direct bearing on hiring. According to Puri, a bounce-back is likely as, on the whole, demonetisation is expected to be a positive for Indian Inc.
Moorthy K Uppaluri, MD & CEO, Randstad India, however, said the firm has not seen any significant impact on hiring post demonetization. "The last quarter of the year is a slow hiring period and this could be one of the reasons why there is a downward trend in the hiring figures from India Inc, and hence we cannot be definite that this is only due to demonetization," said Uppaluri.On the other hand,Randstad expects to witness a lot of traction in the financial infrastructure and technology space like POS (point of sale) devices, ATMs and e-wallets. "The growth in business for these companies is definitely going to have a positive impact on their hiring plans too, which is likely to see an uptick in the coming months," said Uppaluri.
Employment in India is broadly divided into two: structured (organization, including global as well as domestic companies) and semi-structured SME-based employment. While employment in the structured set-up has always been less cash transactional and has almost negligible impact on job opportunities, Sunil Goel, MD, GlobalHunt, said SME-based industries that mostly see ad-hoc employment and pay wages in cash have been impacted temporarily.
"We strongly feel that this is a very temporary phase from employment and job opportunity point of view, till things normalise and wages are payed through electronic and banking systems," said Goel.
In the last quarter of 2015, hiring growth rate was about 7.5%. According to Randstad, the hiring growth rate is expected to be marginally higher at around 7.8-8% in October-December quarter of the current calendar year.