Companies are likely to slow down hiring in the coming quarters because of several factors, including elevated and persistent inflation, geopolitical uncertainties due to the war in Ukraine and rising interest rates.
Citing leading recruitment firms and human resource experts, ET reported that the second half of the calendar year may see up to a 20 per cent drop in recruitment from current levels across replacement hiring as well as new job creation.
Also, companies are forced to tighten their purse strings for salary hikes and counteroffers that have become a new normal in recent times.
Shiv Agrawal, managing director of ABC Consultants, told the business daily: “What has been happening in the job market for the past few months is not sustainable — the crazy attrition, salary offers will slow down. It could be the beginning of the end of the ‘Great Resignation’. ”
Worth mentioning here is that the shock is already being felt by the startup sector that has seen more than 3,500 retrenchments in 2022 amid a funding crunch. “The startup world was absorbing a lot of talent; if that’s going to slow down, it may have a knockdown effect on others,” Agrawal added.
He went on to add that when the attrition rate drops, it impacts the replacement hiring market, anticipating a 15-20 per cent hiring decline by the year-end.
The financial daily quoted Guruprasad Srinivasan, group chief executive of Quess Corp, as saying, “At the moment, we are sitting on a 30 per cent growth in open mandates compared to same time last year. But by October-December, we see demand slowing down a bit by 15 per cent from these levels as cost pressures come in.”
Further, the sky-high inflation and the ongoing Russia-Ukraine conflict will play their part and so much depends on how interest rates move in the coming months.
Alok Kumar, senior director at ManpowerGroup India, told the daily: “We’ve started seeing job losses in startups; some new listings have not taken off as expected. This is a sentiment-driven market. Sectors like IT product, tech will grow but some others may see some slowing down. ”
Recruitment will continue in companies that have already taken investment decisions, but where investment expenditure hasn’t happened already, those entities may delay the hiring process, the publication quoted Santrupt Misra, global director for HR at Aditya Birla Group, as saying.
