Covid aftermath: Hiring sentiment improves for e-commerce, tech startups, SMEs; recovery 6 months away

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Updated: Jul 21, 2020 4:18 PM

The intent to hire (percentage of employers that is likely to hire employees during the current half year of FY21) for e-commerce businesses and technology startups recovered from 19 per cent during the lockdown period to 26 per cent.

Two out of five e-commerce companied had a “strongly negative business sentiment” for the current HY.

The hiring sentiment in the aftermath of Covid-19 among e-commerce companies and technology startups has slightly improved for the current half (April-September) of the financial year 2020-21 vis-à-vis the lockdown period of over 10 weeks from March 25 till June 7, 2020, according to a survey report by blue collar jobs portal Teamlease. The intent to hire (percentage of employers that is likely to hire employees during the HY) for e-commerce businesses and technology startups recovered from 19 per cent to 26 per cent between the said period. E-commerce and tech startups was among the 10 leading sectors helping India to recover its hiring sentiment from 11 per cent during the lockdown period to 18 per cent for the current HY.

While sentiments among small businesses also improved from 2 per cent during the lockdown period but couldn’t recover beyond a paltry 7 per cent. For mid-sized businesses also the sentiment, though doubled, scaled to just 12 per cent for the April-September period. However, large businesses had a relatively better outlook as the intent to hire improved from 15 per cent to 24 per cent. “A sizeable proportion of large businesses are proactively pursuing business revival initiatives and displaying greater willingness to hire (and have also fared better after Unlock-1) compared with medium and small businesses,” according to the report that surveyed 807 small, medium and large businesses in 21 sectors and 14 businesses globally.

“Organizations are increasingly becoming conscious of the fixed costs and that is one of the major reasons for the slow uptick in the employment sentiment by the mid and small businesses,” said Rituparna Chakraborty, Co-Founder & Executive Vice President, TeamLease Services.

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Two out of five e-commerce companied had a “strongly negative business sentiment” for the current HY. Non-essential goods, which makes up for 90 per cent of sales, was severely impacted for large retailers. On the other hand, 60 per cent B2C startups are staring at closures due to the lockdown impact while 40 per cent are temporarily shut or winding up their businesses, the survey report titled Employment Outlook Report said. The businesses surveyed added that the recovery for e-commerce ventures and technology startups would take at least six months. Nonetheless, the e-commerce sector is expected to grow at a CAGR of 19.6 per cent for coming three years while edtech businesses are witnessing a 14 per cent increase in revenue, it said.

“Though it may take a quarter or more, these businesses will also definitely pick up bringing about a marginal improvement in the overall employment scenario,” Chakraborty added. Across categories and sectors, the intent to hire was highest for businesses in metro and Tier-I cities at 19 per cent for current HY from 13 per cent during the lockdown in comparison to 14 per cent, 11 per cent and 10 per cent for companies based in Tier-II, Tier-III and rural areas respectively.

With respect to hierarchy, the overall sentiment was highest at 29 per cent for senior level hiring followed by 18 per cent for mid-level, 16 per cent for junior and 6 per cent for entry level. In terms of functional area, the intent to hire was highest for blue collar workers at 29 per cent. The sentiments for hiring in HR, office services, engineering, IT, marketing and sales departments were at 8 per cent, 15 per cent, 11 per cent, 16 per cent, 9 per cent and 14 per cent respectively.

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