Despite Bleak Manufacturing Sector Job Market Upbeat On Hiring Plans
The survey highlights that the proportion of respondents reporting higher output growth during the quarter in consideration has fallen to 47 per cent against 50 per cent of the second quarter
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Industry lobby FICCI's latest quarterly survey on manufacturing suggests slightly less optimistic outlook for the manufacturing sector in the third quarter, October- December 2017-18, as the percentage of respondents reporting higher production in the third quarter has fallen vis-à-vis previous quarter.
Is this the bad news for the job market? While the survey point towards a bleak scenario, headhunters are optimistic.
"Compared to the last two quarters, unlike December which typically is a go to sleep kind of month, its first time where we still continue to get job requirements. This is the period where quarter/requirements slow down by 15 per cent but this is the only time where we are seeing that compared to last quarter which obviously was bad we have an upside of 20 per cent," noticed Kamal Karanth, former managing director of the US-based staffing firm, Kelly Services.
Recruiters say that the companies are trying to get their goods and services tax application, the execution right. "Probably, they are gearing up for the action in the coming quarters and hence, they are hiring. I am seeing a lot of action in the automobile sector," Karanth says who recently launched his own venture, Xpheno, a specialist staffing company.
The survey highlights that the proportion of respondents reporting higher output growth during the quarter in consideration has fallen to 47 per cent against 50 per cent of the second quarter.
"This less optimistic outlook for manufacturing in the third quarter of current fiscal is reported to be due to factors like rupee appreciation impacting exports, issues with regard to GST implementation and subdued demand in several sectors," pointed the survey. It also noticed that in the order books, about 42 per cent respondents in Q3 are expecting the higher number of orders as against 47 per cent of Q2 2017-18 which again is reflecting subdued demand in the economy.
Rituparna Chakraborty, co-founder and executive vice president, TeamLease, a staffing agency, found the outlook confusion. "One of the reasons for this outlook could be that there is instability in the small and medium scale sector who have still not been able to grapple with demonetization and GST. There are enough indicators which are saying that larger organisation, the bigger corporates across the country are going to contribute to more job creation which is huge manufacturing," she said.
"I'm not worried about this impacting the job sector because manufacturing contribution to employment has been less than 12 per cent. It's not that manufacturing has been a big job creator in the near or the long-term past. Maximum job creation has been happening from the services sector into formal employment scenario," Chakraborty elaborated.
Aman Attree, HR Head, Hindustan Powerprojects feel the survey's outlook talks about the short-term impact. "People have higher expectations from manufacturing sector as it generates jobs for the masses. We definitely want manufacturing sector to pick up to create more and more jobs. However, I presume that things will get better in coming two quarters," he predicted.
FICCI's latest quarterly survey assessed the expectations of manufacturers for Q-3 (October- December 2017-18) for twelve major sectors namely auto, capital goods, cement and ceramics, chemicals and pharmaceuticals, electronics & electricals, food products, leather and footwear, machine tools, metal and metal products, paper products, textiles and textiles machinery. Responses have been drawn from over 310 manufacturing units from both large and SME segments with a combined annual turnover of over 3 lakh crore.
(With inputs from Shivendra Saxena)