The HR Industry is Fighting Its Battle

According to the Reserve Bank of India’s (RBI) Measuring Productivity at Industrial Level India KLEMS (capital, labor, energy, material, services) data, India adjoined 4.67 crore jobs in FY24. The data further reveals that currently, there are 64.33 crore provisional jobs, up from 59.67 crore in FY23. However, this number clocks magnitudes much higher than the estimates by private surveys that point out the country's high unemployment rate. On the other hand, the sectors in which these job opportunities are opened up are also a challenge. For instance, according to a Bloomberg report, around 46 percent of the workforce is still employed in agriculture, which contributes less than 20 percent to the gross domestic product (GDP).

Mean while, the manufacturing sector accounts for only 11.4 percent of total jobs in 2023. Remember, the Indian government hopes to have 25 percent of the economy’s output come from manufacturing by 2025 through the implementation of different programs and policies. While this accounts for the significant disparity between growing job opportunities and increasing unemployment, one of the other reasons is the skill gap. The unemployment rate rose to an eight-month high of 9.2 percent in June 2024, according to data from the Centre for Monitoring Indian Economy (CMIE).

The case of IT hiring is also not much different. IT companies are looking for talents with multiple skills. Lend your years to Rajesh Balasubramanian, Executive Vice President & Global Head –Talent Supply Chain, Hexaware Technologies. In a recent interview with CEO Insights, he said, “The hiring process going forward will be longer and more meticulous, with multiple rounds of evaluation, including customer interviews, becoming quite a norm. On the supply side, the talent pool has become highly narrow over time. The overall IT spending from the clients is also shrinking.”

As the challenges in hiring brew up, the timing couldn’t be better for publishing our yearly special issue, shedding light on HR leaders in India. Do let us know your thoughts.