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Coronavirus pandemic | Worried about pink slips, execs now ready to move jobs with pay-cut

Candidates are ready to take lower pay hikes or even cuts due to the looming threat of job losses

March 30, 2020 / 12:38 PM IST

Till about a month ago, Vidyut Kapoor was confident that he would be able to get at least a 30-40 percent jump in his salary when he switches to a new job.

But, things have changed, with the coronavirus outbreak in the country.

The 25-year-old hospitality industry professional has now applied to companies in the FMCG sector and is open to any role, even without a pay increase.

“I have been working in the hospitality sector for two years now. However, the way things are moving it looks like I may lose my job, especially I am among the newest entrants. Hence, I am open to any job offer from a good brand, even if there is no hike,” said Kapoor.

COVID-19 has led to 29 deaths and 1,071 positive cases in India as of now. This has led to the government asking companies to offer work-from-home facilities to staff and also mandating non-essential service firms to suspend operations.

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The worst-hit sectors include aviation, travel/tourism, retail and hospitality. Restaurants have also been forced to down shutters till the situation improves in India.

At this juncture, human resource heads of companies have reported a rise in the number of applicants ready to take up job offers without salary negotiations.

“For us, a typical salary negotiation would begin with a 10-15 percent and go upto 40 percent for candidates with high-demand skills. But, now even those with niche skill sets are ready to take up a job offer if it is a 5 percent hike,” said the HR head at a financial services firm.

The person quoted above said that they had received close to 50 applications over the last two weeks and added that these were mostly from employees in the advertising and hospitality sectors.

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For companies, it helps them save costs since salary outgo is a significant portion of the expenses. If good candidates with relevant work experience are ready to join at a lower salary, it is a win-win for the company both from a new hire standpoint and cost aspect.

Various studies have shown that salary is one of the primary reasons for Indian candidates to switch jobs. But, the COVID-19 situation and the accompanying uncertainty have led to companies exercising caution about the staff strength and taking tough decisions to let go off people.

An International Labour Organisation report said that Almost 25 million jobs could be lost worldwide as a result of COVID-19.

Human resource consultants have told Moneycontrol that candidates are even ready to take a pay cut, calling it a desperate measure which is inadvisable.

“We had recently interviewed a senior resource in the tourism industry who was ready to take upto 20-25 percent cut in his annual compensation if he got a job in another good brand. While we did try to convince him to change his decision, he was worried about losing his job soon,” said the head of a Mumbai-based hiring firm.

Companies have already announced suspension of operations or shutdown. On March 29, IndiaNivesh announced that it had shut its Portfolio Management Services (PMS) business, citing ongoing market volatility amid the novel coronavirus pandemic.
M Saraswathy
first published: Mar 30, 2020 12:38 pm

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