Tepid growth in jobs and salaries ahead
Information technology giants Samsung Electronics and Google may have made big pre-placement offers at two Indian Institutes of Technology (IITs) in 2012, but this may not be the case for prospective graduates in other institutes in the coming year. Human resource (HR) consultants predict a cautious year ahead for hiring, with salary hikes being lower in some cases.
Hay Group, a global management consultancy, in its annual General Industry Compensation Report covering all levels of management, expects a pay increases of an average 11.2 per cent across job roles in 2013. The amount represents a slight fall against an actual average salary increase of 12 per cent across companies in 2012.
The year 2012 was a slow year in terms of job creation and salary hikes. Double-digit salary hikes were rare and the sentiment was gloomy across sectors. "I would like to believe that it was more the play of negative sentiment in the job market than the actual dearth of jobs. However, facts state otherwise. The fall in GDP (gross domestic product) growth to an average of just 5.4 per cent in the first six months of 2012 may have cost jobs. There is a massive difference in the number of new jobs created at five per cent and at seven per cent (growth rate in 2011-12). That number is 3 million," said Ganesh Shermon, partner and head of human capital at KPMG.
He added sectors such as healthcare, media and entertainment witnessed more-than-expected hiring in 2012. Similarly, the education sector also saw growth in overall salaries. "Also, it's interesting to note that even though companies hired cautiously at the entry level, many of them were reasonably bullish in hiring on the key middle and senior management level positions," Shermon said.
Churn in the senior management level was also witnessed in 2012.
Sangeeta Lala, vice-president, Team Lease Services, said the year saw some change of guards at the top level.
While most companies hired cautiously at the entry/ trainee levels (given the continued shade of uncertainty), they were reasonably bullish in hiring the skilled workforce at the middle management and the senior management levels.
Looking at 2013, HR consultants expect employability of graduates to be a crucial issue. In India, according to Shermon, there is always a difference between the number of fresh graduates and the number of new jobs. "The skills acquired by the fresh graduates are not in alignment with the marketplace requirements."
Endorsing this view, Lala said there was a supply in excess of the right jobs today. "Employers are facing this puzzle when they have jobs to offer, but they continue to search for the good-old-days when students were willing to work hard and come up with genuine effort, learning and earning along the way," she said.
The TeamLease- IIJT Employment Outlook Report for the January-March 2013 quarter said both the net employment and the business outlook had registered a drop in their indexes, indicating stagnant hiring outlook in the forthcoming quarter. "IT/ ITeS and Infrastructure are the laggards dragging the index down while other sectors report flat outlook," said the report.
Added E Balaji, chief executive officer of HR services company Randstad India: "If you go by the general expectations from economic reforms and stock market, there are mixed reactions. We expect stock market-related sectors to show recovery in 2013. With FDI (foreign direct investment) coming in, retail will be a sector to watch out for, in terms of new jobs. So, the overall the mood is of cautious optimism in hiring."
Photographs: Shannon Stapleton/Reuters