Hiring Activity Among Start-ups Soars Despite 6% Annual Drop in E-Recruitment: foundit Insights Tracker

 foundit today released the monthly foundit Insights Tracker (fIT). Despite economic uncertainties, the latest tracker reported that hiring activity among startups has significantly increased this month. While there has been a 6% decline in e-recruitment for white-collar compared to the same period last year, the market for new and emerging job roles is up.

The Tracker noted a 4% monthly dip, indicating cautious hiring sentiments among Indian recruiters. While BFSI (+3%), Travel & Tourism (+2%), and Import/Export (+13%) picked up on a month-on-month (MOM) basis, many sectors such as Logistics, Home appliances, and Oil and gas saw a steep fall. 

Commenting on job trends for April 2023, Sekhar Garisa, CEO - foundit (previously Monster APAC & ME), a Quess company said The current global economic uncertainties have created a challenging environment for businesses, forcing them to navigate a rapidly changing environment. Although hiring has declined, there are still a plethora of job opportunities in emerging industries for job seekers. Remarkably, the Indian startup ecosystem has taken a turn, exhibiting resilience in hiring intent despite the prevailing job market challenges. While we expect cautious hiring sentiments to persist, we remain optimistic about job opportunities for candidates, particularly as startups continue to propel the demand for talent and innovation.”

Retail, Travel & Tourism are among the top industries exhibiting positive growth YOY basis while BFSI and BPO sectors continue to be apprehensive

The retail sector has grown by 22% year on year (YOY), which is encouraging for job seekers in emerging industries. E-commerce has contributed significantly to this growth, with India now home to some of the largest online retailers. Since November 2021, the sector has experienced double-digit growth, with notable increases in Omni channel retail and retail real estate. This expansion has increased demand for skilled professionals on the shop floor, providing ample opportunities for retail job seekers. Hiring in Travel and Tourism has also experienced a noteworthy growth of 19% YOY, as domestic and international travel spiked this summer. As per industry reports, domestic air passenger traffic for FY2023 is predicted to reach the pre-pandemic levels seen in FY 2019, ascertaining that tourism is back on track.

The Telecom sector's job market grew by 14% YOY, putting it among the top three most actively hiring sectors. Meanwhile, cybersecurity professionals are in high demand attributed to the increasing dependence on technology and digital platforms, which has consequently led to a rise in cyber-attacks and data breaches. Other sectors that have shown growth momentum annually include NGO/Social Services (+11%), Advertising, Market Research, and Public Relations (+7%), Oil/Gas (+3%), and Shipping/Marine (+2%).

On the downside, BFSI (-4%) and BPO/ITES (-13%) sectors continued to witness a YOY hiring dip as companies watch their spends on talent acquisition. Other sectors like Healthcare, Biotechnology & Life Science (-16%), Media & Entertainment (-17%), Import/Export (-19%), Agro-based industries (-20%), and IT-Hardware/Software (-22%) have also witnessed a significant decline in their hiring patterns compared to the previous year.

Hiring intent by startups in India Inc. see a 19% YoY growth

Despite the sea of layoffs that have been reported, especially across Indian IT, the overall hiring demand among startups has noted a strong 19% growth this April 2023 compared to the previous year. Tracker states that India housed over 19,000 startups before the pandemic. This number has swarmed up to over 80,000 last year which created over 250,000 job opportunities. Over the last three months particularly, demand for talent among startups has seen impressive growth.

Hiring demand by startups, as per foundit data (month-on-month)

In Indian IT, while overall hiring has been moderate over the last year, the trend observed in startups is quite the opposite. After the Great Resignation period, many companies exhibited talent hoarding behaviour by over-hiring and offering high compensation packages. Due to this, the IT industry went through a notable correction period last year. However, it is important to note that the demand for tech talent across industries stood steady, considering the value that niche tech skills continue to hold in the market. IT holds the maximum share of total job demand in the startup space currently at 20%.

While Edtech (8% share) was among the top 5 industries hiring within the startup sphere, the sector held a much larger share last year. This is well reflected in reportage around continued layoffs. Other segments such as the Internet (12% share), BFSI/Fintech (11% share), and Media & Entertainment (7% share) also accounted for considerable demand share in the startup hiring space. On the other hand, Healthcare and BPO startups exhibited a negative hiring intent.

Job postings by startups have been driven by increased hiring across metros, while robust hiring has also been noted for remote roles. Bengaluru (33%) accounts for the highest share of startup jobs while Delhi, Mumbai and Pune also hosted notable demand trends.

Ahmedabad exhibits marginal growth in e-recruitment while job trends across Bangalore and Kolkata see a decline

City trends indicate that Ahmedabad (+3%) noted a marginal improvement in hiring activity this April as compared to the previous year. However, other cities monitored by the Tracker noted a negative trend. Bangalore witnessed the highest decline in online hiring activity with a 21% annual fall, followed by Kolkata (-18%), Chandigarh  (-18%), Hyderabad (-15%), Pune (-12%), and Delhi/ NCR (-10%). The maximum drop in hiring activity was observed in industries such as IT hardware, Software, Media & Entertainment, BPO/ITES, and Automotive across metro and Tier 2 cities.

Despite ongoing layoffs, freshers experienced the lowest dip (-9%) across experience levels. On the other hand, demand for leadership roles exhibited the highest drop YOY (-34%). Mid-senior level roles recorded an all-time low hiring rate (-25%), while intermediate and senior level roles also witnessed declines of -20% and 15%, respectively on an annual basis.

Customer Service and Software Roles see the maximum decline in annual hiring

Although the growth momentum for many job roles has slowed, Sales & BD (+2%) has seen marginal annual growth in e-recruitment.  The overall slowdown can be attributed to the ongoing appraisal season, where organizations are occupied with conducting performance evaluations of their existing employees, and the focus shifts from hiring new candidates to retaining the current workforce. Furthermore, HR & Admin roles also reported muted growth, but it is expected to pick up next month as companies begin to look for qualified professionals to fill key positions and support their business operations.

Customer Services (-28%), Software, Hardware, Telecom (-19%), Engineering/ Production (-17%), and Healthcare (-13%) experienced the highest decline in hiring activity, followed by Healthcare (-13%), Marcom (-12%), and Supply Chain (-11%) roles.