‘Retail hiring up, brass salaries hit’

After suffering a huge setback in both domestic and international markets owing to the downturn, hiring in the retail sector has started looking up again. With expansion plans lined up by many retail majors, firms are on a hiring spree. According to a recent Ma Foi Randstad Survey, between July and December 2010, the consumer and retail services sector is generating an additional employment to the tune of 13,200.

Despite the greenshoots witnessed in the the sector, salaries at the absolute top levels of CEO and MD are seeing a dip. ?The packages of Rs 3-3.5 crore per annum at the top level have completely stopped in the retail sector. They are now down to Rs 1-1.5 crore per annum.? says Shiv Agrawal, CEO of ABC Consultants. ?Also, considering the inflation, there is a fall in the middle level salaries by about 5-10% from the peak. The salaries at the mid level currently are in the range of about Rs 20-25 lakhs per annum,? he adds.

Hypercity Retail, the hypermarket chain of K Raheja Corp Group, which plans to launch six to eight stores every year, hires about 150 direct employees per store. Says Ashutosh Chakradeo, head-buying, supplying and supply chain, ?Hypercity employees are entitled to a 25% bonus across the board for all the applied schemes. However, the bonus is liable to be profit-linked.? Moreover, he anticipates a hike of 20-25% on an average in employees’ salaries year-on-year.

Consulting firms, which are seeing more mandates in the retail sector say, companies in the retail space are bullish on hiring, but when it comes to salaries, they are cautious.

?Compared to 2010, the year 2011 is expected to witness 20-25% jump in hiring across the board in the retail space, whereas salaries across the board on an average is anticipated to grow by 10-15%,? reveals Agrawal.

The India Retail report for the third quarter of 2010 forecasts total retail sales is likely to grow from $353 billion in 2010 to $543 billion by 2014. Of this, only 5-8% will come from the organised sector. Moreover, experts say that increasing middle and upper class consumer base will increase the potential of the retail sector in Tier II and II cities.

With 9000 employees currently, Aditya Birla Retail Ltd (ABRL), which is on an expansion mode said it will hire about 2000 employees in the year 2011. It usually hires around 200 people per store.

Thomas Verghese, CEO of ABRL says ?Since the attrition rate is high, every year around 5,400 employees need to be hired for replenishment. Another 4,000 employees are hired for expansion purpose on a yearly basis. On the salary-front, there is a likely hike of about 10-12% in 2011.? ABRL has 530 supermarkets and nine hypermarkets in the country.

Registering a growth of about 28.6% y-o-y in the first five months of FY11, the retail sector is surely poised for growth. With more hiring expected in the next year, the sector is also set to see foreign direct investment flowing in multi-brand retail. If that happens, the industry is set to witness a spurt in hiring and salaries across the board.