Skill, Labour and Talent for MSMEs: With the second Covid wave abating in most parts of the country and the rate of vaccination going up, small businesses are increasingly keen on hiring more people. The growing intent to hire people assumes significance after MSMEs witnessed an exodus of migrant labourers and workers while many enterprises had to force themselves to narrow their employee headcount due to Covid-induced impact on demand, supply, production, and overall growth. However, the outlook to hire more people in the current new normal among small businesses is expected to gradually go up.
“With ease in Covid-related restrictions, we are seeing recovery in businesses across most of the sectors where MSMEs are present including garments, electronics, electrical engineering goods are seeing an increase in work. Hence, they are looking to hire more people. The demand is resuming barring sectors such as hospitality, aviation, which would still take more time to see an acceleration in business, while exports are also beginning to improve. Hence, the demand for skilled and semi-skilled workers is there now,” Pankaj Kumar, Owner of electrical goods manufacturer A-Powertech Electricals and Past President, Indian Industries Association told Financial Express Online. The body has over 9,000 MSME units as members.
MSMEs’ plan to hire ahead aligns is also reflected in the latest study on the businesses’ intent to hire by Teamlease called Employment Outlook report for the current (October-December) quarter. According to the report, which surveyed respondents from 650 businesses including 327 small and 204 medium enterprises, noted that 29 per cent small businesses had an intent to hire this quarter in comparison to 26 per cent in Q2 and 20 per cent in Q1. On the other hand, the intent among medium businesses to hire was also up from 24 per cent in Q2 to 26 per cent in Q3.
“There is a continued momentum of progress with respect to intent to hire. In fact, one of the overarching aspects across sectors was that there is a positive movement in their outlook to hire more people. Even a 3 per cent growth among small business makes a material difference because despite constraints these businesses have been able to move forward as overall demand across all kinds is improving,” Rituparna Chakraborty, Co-Founder & Executive Vice President, TeamLease Services told Financial Express Online.
Considerations of back to work and hybrid work models, following accelerated and large-scale vaccination campaigns across the country have boosted hiring intent in general across different business sizes, according to the report. Small businesses are sustaining their appetite for hiring on the back of substantially improved consumer sentiment.
While more small businesses are looking to hire employees, the talent supply also seems to be in abundance while the number of vacancies or jobs looks lesser. For example, the number of passed out trainees or students of MSME Technology Centers across India and looking for jobs is more than 4.73 while there were over 6,200 recruiters, according to the data from the government’s MSME job portal MSME Sampark as of October 3, 2021. However, the number of vacancies, as per the portal, was only 54 while open job posting was 10.
Importantly, India’s unemployment rate declined to 6.86 per cent in September from 8.3 per cent in August this year even as it was slightly higher than 6.68 per cent in September last year, according to the data from the Centre for Monitoring Indian Economy (CMIE). Moreover, employment was up by 8.5 million in September to 406.2 million on the back of salaried jobs.