We have been told that the Indian economy has been running like a mad bull, surpassing China in the recent past as the fastest growing major economy. This raging bull will be constantly hungry for more manpower, something India is in no shortage of. Our population is significantly below 35 years and is expected to get younger by 2020 (go figure!)
But are we prepared to accommodate this massive workforce growth? The net employment outlook (percentage of net employment opportunities expected by recruiters), though on a positive turn, back in the latter half of 2017 stood only at 18%.
This was a much smaller rise as compared to the hiring intentions in the years before, when the net employment outlook in 2005 was in the neighbourhood of 40%, showing a decline of nearly 20% points over the years, as per Manpower Group’s survey.
In this article, we will take a shallow dive into employment statistics and outlook, as per various studies and industrial sectors.
According to the KLEMS India Database, a research supported by the Reserve Bank of India, growth rate of total employment (in percentage) in the total Indian economy has shrunk, as compared to its previous years, as of 2015-16.
From a 2.4% growth in the early 1980s, it is now at a 0.1% decline, with a hopeful 0.1% improvement over the decline the year before. Though this big picture comprises of several successful and other not-so-successful sectors like Agriculture.
Moving on from the bird’s eye view to a ground level status, here are some sector wise takeaways according to TeamLease’s Employment Outlook Report 2017-18.
The net employment change refers to the number of respondents interested in hiring minus the number who are not, over the next six months of the financial year. The second column refers to employment outlook change of the second half of the 2017-18 financial year over the first.
|Popular Sectors||Net Employment Change||Remarks|
|Financial Services||3%||Increase in RBI licenses to private sector to improve the sector|
|Knowledge Process Outsourcing (KPO)||2%||Demand for analytics professionals to increase|
|Health & Pharmaceuticals||1%||Large scale medical establishments fuelling hiring. Specialized health care professionals to be in demand. Eg: Hospice, Ambulatory Care, etc|
|eCommerce & Tech Startups||1%||Demand for data analysts, machine learning, UX/UI designers etc to increase|
|Power & Energy||1%||Government funding to help hiring, with renewable energy sector to hire maasively|
|Media & Entertainment||1%||Revenues are rising and the sector is expected to grow massively|
|Telecommunications||0%||5G, M2M, IoT to increase recruitment demand|
|Retail||0%||Major brands will expand. Walmart to open up 40k+ jobs in the north|
|Information Technology||0%||Firms hiring on strict need-basis, except for Infosys. Industry is predicted to create 20-38% fewer jobs|
|Educational Services||-1%||Need for skilled workers in analytics, machine learning, etc. Though heavily dependent on govt. initiatives for job creation.|
|Fast Moving Consumer Goods & Durables||-1%||Hiring on hold except for certain major Indian brands|
|Manufacturing, Engineering & Infrastructure||-2%||Hiring has declined, though showing possible signs of improvement.|
|BPO/ITeS||-3%||Hiring has declined.|
Other sectors like Power & Energy, Media, Telecommunications, and Retail had little to no change in employment outlook. Whereas Travel & Hospitality, Agriculture and Construction & Real Estate are taking big employment hits in the neighbourhood of 4-7% decline.
As far as salary trends are concerned, according to the Q3 2017 Salary Budget Planning Report by Willis Tower Watson, India is projected to increase salaries by 2-3% in middle management level for average performers, a still or decline in salary hikes in upper management, while an overall average of 10% for junior management.
The sectors with the largest hikes are in Energy, Retail, and FMCG. Projected salary in Financial Services is less than other sectors while Media and Pharmaceuticals is projected to be less than their 2017 salary hikes.
With a billion mouths to feed, and nearly 500 million in the Indian workforce, creation and sustenance of jobs is the way out of the bleak employment outlook. Though largely positive in many sectors, the growth is simply not enough and some of the culprits are obvious, but not easily solvable.
Though promises by governments and their policies seem to be ever increasing, the country is still suffering from large scale unemployment, and promise of job creation keeps alluding the population. Here are some major problems, among others, that are plaguing the Indian employment landscape.
|Education Level||Number (in millions)||Share in Labour Force|
|Literate without formal schooling||2.12||0.45%|
|Below Primary + Primary||102.38||21.78%|
|Graduate + Above||37.41||7.96%|
Source: Planning Commission 2017
When over 65% of your workforce is less than high-school pass, with nearly 50% with primary or less education, there is clearly a skill problem. And a lack of sufficient skill can lead to a lack of decent employment opportunities.
Let us be hopeful of our status as being one of the youngest workforce countries in the world. However, if we don’t actively work to improve for the future, the Growth Rate of Total Economy Employment plot above will increasingly resemble a child’s slide, slipping more and more into the depths of unemployment despair.
Hey, but we are not about to leave you with a frown. Here are some links to keep you chugging at a better future.
Or just peek into our repertoire of some gyaan on career options in India.