India Market Update- Q1 2022

6 Minutes

As we close on the first quarter of 2022, I’ve sat down again to gather my thoughts on the m...

By Gaurav Yadav

Director

As we close on the first quarter of 2022, I’ve sat down again to gather my thoughts on the market.

In my last update I recounted the impact of the Pandemic on the HR function in India. The market has now improved to nearly pre-pandemic levels, unemployment has declined, and the overall economic outlook is positive. India has emerged as the second biggest startup hub globally. As per the Economic Survey, India now has 83 unicorns collectively valued at more than $275 Billion which is expected to rise to 100 unicorns by 2025 which will create 1.1 million direct jobs. There are now more than 50,000 start-ups and of these 10,000 came up in last 12 months.

There are many factors for this boom; India has a young population, 65% are in the 25-35 age bracket, and many have set up their own businesses. Rapid digitalization, which was already creating growth in the country pre-pandemic, was accelerated by Covid-19 with the digital economy expected to become an $800 Billion market by 2030. At ESHR India, we are seeing all sectors bounce back with IT and Technology leading the way. As per the YouGov-Mint-CPR survey, around 37% professionals in IT companies and nearly 34% in E-commerce and digital services companies have already changed jobs or plan to do so. Job prospects today are even better than pre-pandemic levels. As with many other regions, hybrid working is a hot topic in India.

After working from home for nearly 2 years, employees prefer to have a choice on where they are based, as they look for a better work-life balance. As such one of the current HR challenges is getting employees back into the office as many are ready to resign instead of make a return. Candidates are also turning down job offers which require them to work in the office full time, even when they are offered higher compensation. We are seeing many organizations shift to identifying which roles can be based remotely full time. Additionally, the 'Great Resignation' is here. Employees are quitting jobs for better work-life balance and to spend time with family. Since the on-set of the Pandemic, it has been a challenging time for everyone and many employees are experiencing burnout.

One change I have experienced is, HR as well as business leaders, are introducing a number of initiatives around mental health and employee wellbeing programs into their organizations. In this already challenging market, the talent shortage I reported on previously continues. Employers are finding it tough to attract and retain talent. Candidates know what they want - they no longer take a bump on their salaries and move, they are now looking for workplace flexibility, inspirational business leaders, next-gen managers, culture, wellbeing and an efficient interview process. Since we started working from home the interview process seems to have become longer, for mid to senior level roles I've been seeing talent go through more than 5 interview rounds, including peer level interviews.

As a result we are seeing the overall time to hire legthen. Candidates do not enjoy lengthy processes and the time to hire means they are receiving multiple offers to pick from. The HR job market in India is looking robust. I ran a quick LinkedIn search and it came out with some interesting insights; the majority of growth/job change has happened in the Supply Chain & E-commerce sector where 11% of mid to senior level professionals have changed jobs over last 12 months. Whereas, in the Manufacturing & Industrial sector this stood at only 5%, which clearly resonates with the challenges faced by the industry during the Pandemic. Overall, 7% of senior HR professionals have changed jobs in the last 12 months. In addition to Talent Acquisition and Business Partnering roles, this year there has been a big demand in HRIS and Shared Services roles as well. We anticipate Q2 to be even stronger with some uptick in senior HR positions, while attracting, retaining talent and managing inflated salary expectations will continue to be a big challenge for Talent Acquisition professionals.

If you would like to further discuss the market with myself, are a client seeking to expand your HR team or an HR candidate looking for your next move get in touch at gy@elliottscotthr.com or via LinkedIn.