The job market in India is anticipated to witness a slump in hiring activity in 2012. It is expected that the job market will experience a two digit salary hike in 2012, even though there will be a decline in the hiring activity due to the unstable economic conditions.

Indian economy not crippled by the slowdown

The Indian economy was not damaged by the economic slowdown across the west, which witnessed large scale layoffs in different industries. The situation in the Indian job market was different with the job market gaining momentum towards the end of 2011, which was evident from the relatively better hiring plans of the companies.

Hiring activity to slow down in 2012

It is projected by different studies that the hiring activity in the Indian job market will be sluggish during the next year. Experts say that even though the growth will be slow, the Indian job market will be better than any other countries.

There are concerns that the economic slowdown and the falling industrial output could seriously impact the hiring plans of the organizations. Even though there will be changes in the employment generation outlook across industries, fresh job will continue to be added, but at a slower pace, says experts in the field.

The slowdown might have a small impact on the job market

According to E Balaji, Managing Director and Chief Executive Officer at Ma Foi Randstad, the slow down in the global economy has influenced the Indian market, even though the Indian market exhibited positive signs at the beginning of 2011.

Increase in hiring activity in some sectors

It is predicted that the beginning of 2012 will witness a growth in hiring activity in various sectors. The sectors that are likely to witness growth in hiring activity are retail, information technology, information technology enabled services, healthcare, nuclear energy, defense, and hospitality. According to Guarav Lahiri, MD at Hay Group India, an international human resource leader, India is to an extent is isolated from the layoffs occurring across the developed countries. He added that the Indian job market is circumspectly optimistic. According to the group, the job market across Indian might witness a two digit growth in salary, which will be with a limit of 12 per cent during 2012. This will be just above the 11 per cent hike which was experienced in 2011.

The recruitment might slowdown

Human Resource experts observing different sectors believe that the hiring activity will experience a slow growth in the months to come. Even though most of the organizations are not likely to reduce the number of employees, which has been carried out by many of the companies in the west, the recruitment of new employees will be put to hold, at least in some of the segments.

Job creation reduced in the past few months

According to Vice President and co founder of TeamLease, Sangeeta Lala, the creation of jobs in the past few months has been found to be reduced by 15 per cent as compared to the year ago levels. The decline was found to be more in sales and customer service. The uncertain economic conditions and the perceived policy stagnation have diluted the customers’ feelings and thus impacted the job creation.

The growing Indian economy will make the job market strong

FMCG, sales, telecom and insurance are the industries that were behind in job creation. In a report published by Ma Foi in October, there was a shortage of 2,29,500 jobs as compared to the forecast of 1.6 million job openings made at the beginning of 2011. However the observers believe that the robust growth of the Indian economy will strengthen the Indian job market. The Indian economy currently grows at a rate of 7 to 8 per cent. In the present day economic condition, the firms are more particular about recruiting the right talent, and most of them are searching for small number of employees who can give meaningful contributions to the firm.

Talent shortage a serious concern

However the Indian job market is facing a major problem- talent shortage. There are serious concerns about the employability of the Indian graduates. More over Indian graduates lack in skills which are required by the industry. These flaws are attributed to the poor quality of education provided by the colleges and management institutions in India. There exist a mismatch between the requirements of the industry and what the higher education institutions offer.

Extensive in house training to help the organizations

Experts suggest that firms should provide adequate in house training to the existing employees to meet their objectives. They should also look for collaboration with academic institutions to provide training to their employees. The organizations should stand up for a long term approach to make sure that they have the required talented and skilled employees that is needed to achieve their targets. This can be accomplished by providing proper in house training or collaboration with academic institutions to train employees, says Mr. Balaji.

A glimpse of the past

In 2008, there were large scale layoffs in India as a result of the recession in the west which slowed down the pace of development in countries across the world. In 2008, the Naukri JobSpeak index had fallen from 1000 in July 2008 to 697 in December 2008. But the situation improved over the two year period and reached 1050 in February 2011 which was a positive sign for the job market in India.

Freshers were in demand during 2011. 33% of the recruitment that occurred in February 2011 was for fresher’s. Opportunities for experienced candidates too increased in 2011, with 37% of the recruitment taking place in the category. As on February 2011, only 3% of the recruitment occurred in the category of candidates with more than 16 years of experience.

In 2010 the salary hike in the Indian job market was 11.7 per cent. Even though the rate of hike in salary during 2011 is clear, it might be between 11 per cent and 13 per cent.