CARE Ratings in the report said 423 companies added a modest 1.6 per cent to their payrolls in 2020-21 as against 4.5 per cent more additions in 2019-20.
Large corporates, mostly private sector banks and three major software firms, have added a net 56,000-odd jobs during the financial year 2020-21, which is a paltry 1.6 per cent growth over FY20, when the net employment generation in the organised sector grew 4.5 per cent, according to a report.
CARE Ratings in the report said 423 companies added a modest 1.6 per cent to their payrolls in 2020-21 as against 4.5 per cent more additions in 2019-20. While they added a gross 1.08 lakh, of that three IT companies alone contributed around 70,000, it added. The report is based on the analysis of the annual reports of large 423 companies across 29 sectors.
Sectoral contributions to the gross additions of 1,08,867 is interesting because as much as 69 per cent came from information technology (IT), 13.5 per cent from banks, mostly private sector banks, and 12 per cent from the healthcare, according to the report.
The agency’s Chief Economist Madan Sabnavis said that what is surprising is that these companies had robust sales of Rs 32.34 lakh crore in the year, which is roughly 46 per cent of the total sales of the 4,500 large companies that had sales of Rs 69.92 lakh crore.
Sabnavis said 235 of these 423 companies, or 56 per cent of them, saw a fall in headcount, with the job losses being 1,03,208 in the year, while only 175 of them added 1,59,262, thus leading to a net increase of 56,054. Of these, the top-10 added 1.12 lakh jobs.
However, the numbers are interesting as the whole year was ravaged by the first wave of the pandemic, and millions of migrants and contract workers lost jobs and livelihood. According to an analysis of the EPFO payroll data, the economy added 16.9 lakh jobs less in 2020-21.
In terms of net increase in jobs, it was just 56,054 by these 423 companies. While, the gross addition was 1.08 lakh jobs in 11 of these industry groups and a fall of 52,813 in the other 18 sectors.
Of the total additions, Infosys, TCS and Wipro alone added around 70,000 jobs or 69 per cent of the total. Five private sector banks — Axis Bank, Kotak Mahindra Bank, AU Small Finance, Bandhan Bank and HDFC Bank — added around 24,000 jobs or 13.5 per cent.
If these three IT biggies are excluded, the overall job scene would have seen a fall of 0.6 per cent in headcount among these 420 companies alone. Also, if these three IT companies are excluded, the sectoral growth would have been a contraction of 0.8 per cent.
Further, if the 31 healthcare companies are removed, then overall contraction would have been 1.4 per cent. And, if the 22 banks are excluded, it would have been (-)3.5 per cent.