India Inc likely to step up hiring by over 8% in 2024: Foundit report

According to the data from the latest foundit Insights Tracker(fit), hiring activity in 2023 was 5 percent lower than in 2022, indicating a slowdown in the job market.

Corporate India is expected to step up hiring by 8.3 percent as businesses step on the gas in the new year, forecasts a report by job portal Foundit. Key sectors that will lead the spurt in recruitment include manufacturing, banking, financial services and insurance (BFSI), automotive, retail, and travel and tourism, it said.

Hiring in Bengaluru is expected to surge by 11 percent among metros. An increased demand for talent with expertise in emerging technologies is anticipated in 2024. While initial delays in IT hiring cannot be ruled out, demand in new-age technologies like artificial intelligence (AI), machine learning (ML), data science, and cybersecurity is expected to soar. These skills are essential for digital transformation, innovation, and security across sectors.

"Stepping into 2024 marks a shift from resilience to an era of remarkable growth in certain sectors. It is not merely about scaling up teams but fundamentally reimagining how we approach recruitment. In this dynamic landscape, the key to success lies in prioritising investments in technologies like AI, fostering sustainability practices, and seeking strategic guidance,” said Foundit chief executive Sekhar Garisa.

Signs of recovery 

According to the data from the latest Foundit Insights Tracker (FIT), hiring activity in 2023 was 5 percent lower than in 2022, indicating a slowdown in the job market. However, the index showed a 2 percent increase in December, indicating a possible turnaround in the hiring scenario.

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The economy experienced a shift towards the end of 2023, breaking the previous trend that was consistent since mid-2022. The job market entered a phase of variability, where both quit and hiring rates stabilised. Despite the lower number of job openings, the imbalance between job openings and hires pointed to the ongoing difficulties for businesses to find the right talent.

In 2023, certain sectors faced significant challenges, registering negative growth in hiring. IT hardware and software experienced an 18 percent decline, reflecting challenges from saturated markets, skill gaps, and global competition. Industries comprising healthcare, pharmaceuticals, biotechnology and life sciences and that comprising banking, financial services and insurance recorded a 12 percent and 9 percent respective decline in hiring.

Manufacturing faced disruptions with an 8 percent decline, attributed to supply chain issues and rising input costs. BPO/ITES, engineering, cement, construction, iron and steel, and education also faced challenges with the dip ranging from 8 percent to 4 percent. FMCG and food and packaged food segment saw a 3 percent decline, feeling the impact of inflation and evolving consumer habits.

HR and admin stand out 

Within organisations, functional roles experienced significant shifts, reflecting a strategic response to the evolving business landscape. Roles in HR and admin recorded a 9 percent increase in demand, highlighting the imperative for efficient workforce management and employee engagement strategies. The hospitality and t ravel sector displayed a similar growth trajectory with a notable increase of 9 percent.

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Conversely, customer service roles faced a 24 percent decline due to increased automation and technology adoption within customer service functions, reflecting a broader industry trend.

Less demand in senior management roles

Senior management roles experienced a significant 12 percent reduction in overall hiring, but there has been a 9 percent increase in the last one month, indicating a potential shift or resurgence in demand for these roles, especially in the manufacturing and BFSI sectors. This trend may be indicative of a strategic reevaluation of leadership structures within organisations hinting at a sustained growth poised to persist.

Software, hardware, and telecom roles registered a decline of 13 percent, possibly influenced by technological saturation and evolving industry demands.

A notable shift in geographical hiring patterns emerged in 2023, driven by cost considerations and improved quality of life in smaller cities. Ahmedabad, with a 6 percent rise, emerged as the top hiring hub, enticing companies with its talent pool and cost competitiveness. On the other end of the spectrum, traditional employment giants like Bangalore and Pune witnessed declines of 16 percent and 13 percent.

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The decline in these IT-centric cities can be attributed to skill gaps, underlining the urgent need for continuous upskilling and adapting to market demands. On the flip side, smaller cities like Baroda (-1 percent) and Coimbatore (-5 percent) managed to weather the storm with a moderate dip, showcasing their cost competitiveness and potential for future growth.

Notably, Kochi (0 percent) and Jaipur (0 percent) held flat growth, indicating resilience. While Delhi-NCR, Chennai and Mumbai faced a 5 percent, 8 percent and 7 percent reduction in hiring, respectively, Hyderabad took the lead with an 11 percent dip. These cities may need to reevaluate their strategies to address industry-specific issues or capitalise on emerging opportunities.