Friday, December 19, 2008

Major job-generating sectors record decline in hiring

Coming days will bring more bad news for job seekers as still worsening economic downturn may cause a further fall in hiring. Decline in recruitment has been witnessed in big job creating sectors in India, reported Financial Chronicle.

In the first quarter of 2008, IT, financial services, FMCG, retail, real estate and consultancy sectors constituted 35 percent of employment, while the number fell to 15.8 percent in the second quarter and to 10.8 percent in the third quarter ending September, finds a yet-to-be released report by industry body Assocham.

Among the six top job making sectors, IT was the most affected sector in terms of hiring. The IT industry contributed nine percent jobs in the first quarter and only 2.3 percent jobs in the third quarter. "The fundamental Indian IT dream is still intact, however my gut feeling is that the crisis is not going to end very soon," said Nandan Nilekani, Co-Chairman Infosys.

Retail sector has also been affected by the crunch. Many big malls have closed down outlets, which caused a decline in hiring. The sector created three per cent jobs in first quarter, while it could create only 1.38 percent jobs in the third quarter. "Most retail outlets are going through a rough phase with growth stagnating. Hiring has been affected at least 50 to 60 percent," said Rama Chandra Agarwal, Chairman, Vishal Retail.

An AC Nielson report had recently observed FMCG sector as the most popular industry of choice for the 2009 batch of management students. Meanwhile, Assocham study finds that employment share in this sector has dipped to only 1.86 per cent this quarter from 4.4 per cent in January. Consultancy, another popular sector among students, has also 1.86 per cent this quarter from 4.4 per cent in January.

Similarly, real estate sector's contribution stands at 1.22 percent currently as against three percent earlier this year. Pradeep Jain, Chairman, Parsvnath Developers and Senior Vice-President, National Real Estate Development Council (Naredco) opined, "Hiring has definitely gone down. These are times of recession and it's a reality. However I see the situation improving in the coming six months."

The things are not different for financial services companies also. Its job share dipped to only two percent against seven percent earlier. "Sectors like financial services, IT and retail have reduced recruitments sharply. The fall has been between 12 to 15 percent," said E Balaji, Chief Financial Officer, Ma Foi Management Consultants.


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