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In a bid to cut losses after consolidation, the telecom sector may shed over 60,000 jobs by the end of FY19 to optimise their staff, according to a report in The Economic Times.
About 65,000 telecom sector workers, mainly in the customer support and financial functions, may lose their jobs by March 31, 2019, staffing firm TeamLease Services said. In these two segments alone, telecom companies are expected to retrench about 8,000 and 7,000 employees, respectively.
"There will be an impact to the tune of 60,000-75,000 jobs on the workforce of telecom service and infrastructure providers in 2019 as a consequence of the consolidation activities," Paul Dupuis, Chief Executive Officer at staffing firm Randstad India told the paper, adding that the effect may continue through 2020.
Riddled with crippling debt and a tough operating environment, telecom companies have been laying off employees over the last one year. Analysts believe that Reliance Jio Infocomm's entry in September 2016 with competitive prices, pushed other telecom operators to drop rates.
Jio's entry in this sector led to the consolidation of the industry to three large private players — Vodafone Idea, Bharti Airtel and Jio — making it an ideal market situation for pricing power to return over time, analysts say.
According to the report, the sector had to let go of over 1 lakh employees. The industry saw an attrition rate of 20-25 percent on average in 2017-2018 as Vodafone India and Idea Cellular merged, Bharti Airtel set out to buy Tata Teleservices’s mobility segment and Telenor India and operators Reliance Communications and Aircel headed for the exit.
"We are over the worst hump and now companies are looking to hire in areas like AI, big data and 4G network expansion. The first two quarters of FY19 saw the worst and that is over," Rajan Mathews, Director General of the Cellular Operators Association of India (COAI), told the paper.
Read — Telecom sector to create 10 mn jobs in next 5 years: TSSC
The jobs losses in this sector, however, will ease as the industry stabilizes, Rituparna Chakraborty, co-founder of TeamLease said.
Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.
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