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Expect lay-offs, fewer jobs in telecom sector despite mergers: Experts

By Shruthi H M | Published: 29th March 2017

BENGALURU: The recent spell of mergers and acquisitions in the telecom sector also portends job losses, say experts.

Recruitment firms and experts Express spoke to foresee lay-offs, fewer hiring and moderate appraisals going ahead owing to the consolidation in the telecom sector.

The sector has been abuzz with mergers and acquistions, the Vodafone India and Idea cellular being the latest. While the sector is looking at bringing in efficiency through consolidation, employees would have to bear the brunt. Speaking to Express, Kapil Gupta, partner, Shella Consultants, said, “The consolidations that we are seeing will definitely lead to job cuts.

Most of the telecom companies are bleeding and are not making any profit. From what I see, we cannot expect any large appraisals happening this time or promotions either.” 

Many employees have already started looking out for jobs, foreseeing the situation ahead, pointed out Sunil Goel, managing director, Global Hunt. “There will be a surplus of resources because of the mergers. Functions like sales, marketing, corporate services and revenue management hold the largest number of people and this is where the lay-offs are likely to be seen,” he added.

Migration towards e-commerce, banking

According to recruitment firms, the trend they have witnessed is that people working in the sector are looking for jobs in allied fields where their existing skills will help.

Those working in the sector are likely to move towards e-commerce, FMCG, start-up jobs, etc. Even the banking sector has been absorbing people from the telecom sector, who have experience working in the customer services segment, say HR experts.

On the other hand, even though there would not be enthusiastic appraisals, the industry is also in need of talent and can’t risk an exodus, observes Jaijit Bhattacharya, partner (strategy and regulatory economics) at KPMG. As far as appraisals are concerned, he says there could be an impact but it will be minimum as the HR will ensure there is no exodus from the sector.

“If you start giving less bonus, the top talent may move outside of the industry,” he said, adding, “Consolidation is done to increase profitability by increasing efficiency.”