Around 80 percent of employers intend to maintain or increase their workforce in the second half of FY24, according to a TeamLease report shared with Moneycontrol.
The surge in workforce expansion can be attributed to government policies and initiatives aimed at fortifying employment opportunities and cultivating a business-friendly environment.
The festive months of October and November have seen a temporary surge across sectors. However, this does not account for a net increase in employment as employers hire more temp roles. Additionally, FMCG/FMCD (Fast Moving Consumer Goods/ Fast Moving Consumer Durables) companies have not found demand from semi-urban and rural locations.
Due to 5G augmentation and technological evolution, the telecommunications industry was bullish on hiring, though hiring during November-December 2023 was expected to be sluggish for the major players in the sector.
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Across various industries, no industry was below 65 percent in incremental new hiring, indicating that new hires largely drove workforce expansion. Manufacturing, engineering and infrastructure, and construction and real estate showed promising hiring trends.
With data from 1,820 companies across 14 cities, the report offers an analysis of anticipated employment trends across 22 industries.
Positive news for job seekers
A striking 84 percent of the employers surveyed expect an increase in workforce in their respective industries over the next six months. Both new hires, at 79 percent, and replacement hires, at 74 percent, are occurring rapidly, indicating a flourishing labour market in the country.
Regarding industry trends, it is evident that healthcare and pharmaceuticals stand out with 86 percent workforce expansion. Electric vehicles (EVs) and infrastructure follow closely behind at 85 percent. Moreover, the top industries for new hiring include the EV and infrastructure sector at 88 percent, and healthcare and pharmaceuticals at 87 percent.
For replacement hiring, power and energy lead the way at 88 percent, followed by FMCD at 85 percent, and healthcare and pharmaceuticals at 84 percent.
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Though the Information Technology or IT industry wasn't the focus of the report, Kartik Narayan, CEO of Staffing at TeamLease Services, told Moneycontrol that the IT industry is undergoing a cyclical downturn after the expansion around digital transformation.
“The muted demand from core markets continues to reflect on the hiring trends of IT services companies. That said, all industries are now looking for skilled IT workers. Technological advancements have generated significant job opportunities in areas like cyber security, cloud computing, AR development, data science, analytics, AI, app development, and digital marketing. The demand in some of these areas is robust,” he said.
Why bullish on hiring?
According to the data, economic conditions significantly impact the employment environment, as cited by 69 percent of respondents. Furthermore, business growth or expansion is a significant factor, as mentioned by 53 percent of respondents.
However, 31 percent of the respondents said skill shortages and mismatches between available skilled personnel and job requirements can have a significant impact on hiring. Additionally, 19 percent of respondents concur that technological advancements are a key factor in determining employment opportunities in India.
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The highlight of the report is that 67 percent of respondents anticipate robust business development during October-March 2023-24, reflecting India's optimistic economic outlook.
Which city is leading the show?
When examining trends by city, the report highlights specific locations where employment opportunities are thriving. Bengaluru has the highest rate of incremental workforce expansion at 89 percent, followed by Chennai at 83 percent and Mumbai at 82 percent.
For new hires, Bengaluru maintains its prominence at 87 percent, with Mumbai at 86 percent and Chennai at 83 percent. In the category of replacement hiring, Mumbai leads with 82 percent, followed by Bengaluru at 78 percent and Chennai at 76 percent. Tier 2 cities are not far behind as they are gaining business prominence and show high incremental workforce expansion in cities like Coimbatore, Gurugram, Kochi, Nagpur, Chandigarh and Indore.
Regarding trends in different functional areas, the report underscores the significance of specific functions within the job market.
In workforce expansion, Human Resources, Marketing, and Information Technology emerge as the top functions with 71 percent, 70 percent, and 70 percent, respectively.
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For new hires, the Human Resources function takes the lead with an impressive 92 percent, while Marketing follows closely at 87 percent. For replacement hiring, Information Technology leads the way with 94 percent, with Human Resources close behind at 89 percent.
On the demand for niche talent, Narayan said rather than focusing primarily on external recruitment for niche skills, many firms are choosing to upskill and repurpose their existing workforce, resorting to external hiring, only when internal training and skill development are not feasible.
“This approach serves the dual purpose of addressing immediate skill requirements while also fostering motivation and growth among current employees,” he added.
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