Hiring intent dips by 80% in 1st half
The finance ministry said banks have sanctioned loans worth about Rs 1,27,582 crore under the Rs 3-lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) for the MSME sector. However, disbursements against this stood at Rs 77,613 crore till July 20. The latest numbers on ECLGS, as released by the finance ministry, comprise disbursements by all 12 public sector banks, 22 private sector banks and 21 NBFCs.
Marking the steepest fall ever, the intent to hire across different sectors has plummeted 80 per cent in April-September 2020 compared to the past four such half-years. But the silver lining is that the hiring sentiment has moved up slightly since Unlock 1.0.
For the April-September
2020 half year, the hiring intent was down to 18 per cent from 97 per cent in the previous half-year. In the past four half-years, the hiring intent had remained between 97 and 99, as per the Employment Outlook report of HR services firm Teamlease.
This is the single biggest fall measured over the entire course of the Employment Outlook reports. The nationwide lockdown meant business and hiring sentiment sunk to an unprecedented low due to the closure of business premises and public spaces, large-scale remote work, migrant exodus and restrictions on distribution and sale of goods. This forced the intent to fall to 11 per cent during the lockdown.
However, the partial and phased opening up of the economy following Unlock
1.0 has resulted in a gradual and incremental improvement in sentiment. With the green shoots of economic revival springing up, the intent to hire gradually inched up to
18 per cent. However, according to the report, out of the 21 sectors analysed, barring travel and hospitality, all the other sectors are positive about future hiring. The recovery was made possible by six of the ten leading sectors, including healthcare & pharmaceuticals, educational services, agriculture & agrochemicals, FMCG, information technology and power & energy.
The intent to hire at senior-level is high for businesses while it tapers down the hierarchy. In mid- and junior-levels, the hiring intent is modest, though at entry-level it is yet to pick up steam. Further, large businesses are proactively pursuing business revival initiatives and displaying greater intent to hire compared to medium and small businesses.
Another major trend is the drop in attrition rate to nearly a fourth or a third of the previous half-year levels. Travel & hospitality, manufacturing, engineering & infrastructure, construction & real estate, FMCG and logistics have reported low single digit attrition levels. Attrition has dropped 40 per cent in agriculture and agrochemicals, financial services, media & entertainment and consulting, among others.
"Though it is more than four months since the pandemic hit us, India Inc is still struggling to come to terms with the new normal, the Covid world. In fact, the pandemic has actually made corporates to re-look, re-structure and re-align their businesses and it is taking a hit on the hiring sentiments. Today, organisations are increasingly becoming conscious of the fixed costs and that is one of the major reasons for the slow uptick in the employment sentiment by the mid and small businesses. Though it may take a quarter or more, these businesses will also definitely pick up, bringing about a marginal improvement in the overall employment scenario," said Rituparna Chakraborty, co-founder and executive vice president, TeamLease Services.