The Job Bonanza

The going has never been this good for India’s job-seekers. With the economy booming and corporates lining up investments for expansion and new businesses, 2007 could be a landmark year for job creation.

WHAT TO EXPECT IN 2007

FASTEST GROWTH: Jobs in manufacturing sector are set to double from existing 41.5 m by 2010 HOTTEST SECTOR: IT & ITEs continue to be the biggest job generator with over 1.5 lakh new jobs BIGGER PAY HIKES: India Inc gives double-digit salary hikes, at 14.4%, for 4th straight year TOP 10 CITIES: Hyderabad created maximum jobs. Ahmedabad, Noida growing rapidly. NET RECRUITMENT: Over 77% firms use online job portals to hire mid-management people

After spending a decade in the trough, the manufacturing rate of growth has also exceeded 12 per cent in the April-September 2006 period. “Manufacturing has an employee base of 41.5 million, this will double by 2010,” says Anand Sudarshan, group president of Manipal Group. Assuming all factors remain constant and the economy keeps growing at 8.5-9 per cent per annum, jobs in the organised sector will double year-on-year over the next few years.

Unlike the 1990s, when jobs were mostly created in the services sector, they are now being created across all sectors. Says Chanda Kochar, deputy managing director of ICICI Bank: “Corporates have lined up investments worth $400 billion, which is a huge opportunity, as the canvas for Indian companies has become much larger.” If manufacturing and services have to grow in tandem, the Government will also have to move fast on key initiatives like the policy on special economic zones (SEZs).

Many moons ago, when India had thrown the doors of its economy open, McKinsey Consulting had come out with a study that had predicted India would be a large market for consumer goods and services. Things may not have gone exactly as the consulting firm had predicted, but the numbers are all adding up now. Every year, India produces 9.3 million university graduates. Assuming that a third of them join the workforce, the number adds up to 3.1 million new professionals every year. A small number for a country of a billion people, perhaps, but the induction of so many people in the country’s workforce shows that 9.2 per cent GDP growth is backed by solid job creation and consumption. And the shortage of qualified people is making the experienced lot a precious commodity. Companies are finally realising that their competitive advantage will come from human capital and not physical infrastructure. Perhaps that is why those like Infosys have given the human resource portfolio to people like Mohandas Pai, former chief financial officer. Even a manufacturing company Marico has moved Milind Sarwate from finance to human resources.

Companies are now racing to shell out the moolah to keep employees happy. For the fourth consecutive year, India Inc is expected to shell out double digit salary hikes in 2007, according to the salary increase study by Hewitt Associates.

A MasterCard study estimates that by 2015, the growing affluent class of Indians will spend $14.4 billion on shopping ($5.6 billion in 2005), $8 billion on dining and entertainment ($5.3 billion in 2005), $13.6 billion on travel and leisure ($3.3 billion in 2005), $8.9 billion on automobiles, personal computers, mobile phones, etc ($2.8 billion in 2005) and $6.4 billion on health and medicine ($1.8 billion in 2005). That makes it a total of $51.3 billion (Rs 20,961 crore). And as they shop they fuel the cycle of consumption, investment and job creation.

The benefits of globalisation are not just restricted to mega metros. People on the periphery are also gaining from this job rush. Students of Syed Hashim Science and Technology College in Andhra Pradesh’s Medak district are a happy lot. Till a few years ago landing a job in the coveted software sector wasn’t easy for them, but with the sector clocking a 35 per cent growth in revenues, the industry is hunting all over for talent. The software sector is poised to create over 1.5 lakh jobs in 2007. With multinational companies committing investments of $10 billion in 2006-07, the software industry is the biggest creator of white collar jobs in India.

The good news is not just restricted to the blue-eyed software industry. According to assocham-PwC study on SEZs, India’s median age is under 25 years, meaning there are over 500 million people below 25 years of age. However, since two-thirds of these are supported by the agricultural sector, a sector which contributes just 21 per cent to GDP, newer opportunities in industry have to be created for them. As government policies translate into corporate action, employment for those on the periphery will only multiply further if policies are on the right track. According to the study, the Government’s SEZ policy can yield 500,000 jobs in 2007-08 and 1.2 million jobs by 2010.

Clearly, India’s 9 per cent growth is neither jobless, nor a flash in the pan.

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