H2 2023 HR Market Update: India

Director of our India office Gaurav Yadav and Associate Consultant Rinkal Choudhary have written an overview of the current HR market in India. The update covers what we are seeing across industries, the effect it has had on the economy over the last quarter and what we predict to see in 2024. 

The economy observed an overall revival in Q4 2023 with heightened consumer spending, marking a return to pre-pandemic celebratory levels during the recent festivals. This surge had a positive impact on various sectors. Whilst the global economic signals hint at a slowdown, the Indian economy is forecasted to grow at 6.3% in Q4, surpassing the estimated 6% as per the monetary policy (Economic Times).

India is witnessing a continued upsurge in the demand for green jobs. However, we have not yet seen this in our roles and are seeing a significant challenge that lies in identifying and recruiting individuals with the precise skill set to meet these evolving needs, with a talent shortage in the EV (electric vehicle) space. Effectively addressing this talent scouting challenge is pivotal for sustaining the momentum in these emerging job sectors. 

Major cities like Bengaluru, Mumbai, Gurgaon, Pune, and Hyderabad have become key hubs for HR professionals in the BFSI sector, reflecting the concentration of businesses in these regions. There is an emphasis on diversity, equity, and inclusion evident in the market, with an increase in companies hiring for DEI focused roles which highlights the evolving priorities within the HR landscape. 

However, despite the active job market, there was a rise in the unemployment rate, reaching a two-year high of 10.05% in October 2023 (Economic Times). This unexpected increase could be attributed to various factors such as sectoral shifts, skill gaps, layoffs, or cost-cutting measures.

In the employment landscape, the commerce sector grew at 41% YoY, there is a burgeoning demand for Mid to Senior HR roles across industries within this sector. Another noteworthy economic catalyst is the robust growth of MSME sectors, fostering job creation, entrepreneurship, and the expansion of the middle-income class. 

Looking into the Banking and Financial Services industry, there has been a demand for diverse opportunities within the HR domain. The demand for HR talent in junior to mid-level roles is significantly higher for Business Partnering, HCM, Payroll, Talent Management, Recruitment, and Learning & Development roles.

Looking ahead to 2024, there is optimism fuelled by increased government investment in economic activities. The Manufacturing sector is set to emerge as a key driver for India’s GDP, supported by the nation’s commitment to low labour costs, advanced construction practices, favourable investment policies, and simplified taxation. These strategic measures position India favourably for global businesses seeking stability and growth opportunities.

If you are looking to grow your HR function in India or are currently seeking your next opportunity within HR contact Gaurav Yadav at gy@elliottscotthr.com or Rinkal Choudhary at rc@elliottscotthr.com