Indian job market to showcase major improvement in 2018
India’s job market is continuing its rebound from the last two quarters after hiring sentiments were marred by a range of factors such as slow GDP growth, demonetization, introduction of GST and shrinking private investments. The overall positive business sentiment along with the revival of sectors such as consumer goods, infrastructure, auto and BFSI has led to a pickup in hiring mandates.
Reports from Mercer, Mettl and Naukri showcase a positive hiring sentiment in the next two quarters, with more than 50% of companies expecting to increase their hiring budgets this year. It appears that most sectors will churn out jobs this year. An ASSOCHAM-Thought Arbitrage Research Institute (TARI) Paper stated that the IT and ITeS sectors will add one million jobs in the next five years. It lists organized retail, transportation and logistics as sectors with good employment potential.
We can expect the job numbers to improve significantly by the end of the year as the government has begun field work to estimate jobs created by the Mudra scheme and the results are expected by the year-end. Data from NPS and EPFO show 3.53 million new jobs were generated in the six-month period between September 2017 and February 2018.
Campus placements, a barometer of the prevailing ground sentiment, are on the increase. The number of pre-placement offers at IITs, IIMs and top colleges have increased 25-30% thanks to strong demand from core sectors such as manufacturing and infrastructure. Besides American and European MNCs, Indian campuses are also attracting companies from Japan, Taiwan, South Korea and Singapore. For recruiters hiring senior-level candidates, salaries and benefits are the biggest challenge.
A major change that we can witness in the coming years will be the creation of new job markets as companies restructure their businesses by adopting exponential technologies. The FICCI-NASSCOM & EY report said 9% would be deployed in new jobs that do not exist today, while 37% would be in jobs that have radically changed skill sets.
Employment in the organized manufacturing and services sector is expected to increase to 46-48 million by 2022. All the new forms of employment are likely to add 20-25% and this would increase the share of the organized sector in the overall economy to 10% from 8%.
2018 is definitely going to be a year of jobs.