98% Surge In US Job Layoffs In 2023: Will It Affect Indian Workers/Jobs?

A 98% surge in US job layoffs was observed in 2023, with companies planning 721,677 job cuts, a significant increase from the 363,832 layoffs reported in 2022, according to a new report by professional outplacement firm Challenger, Gray & Christmas.

High-profile tech companies, including Meta and Amazon, participated in these layoffs, leading to a 73% increase in laid-off employees, reaching 168,032 in 2023. This raises a important question of how Indian Jobs and workers will be affected by this?

Layoffs In US Soared 98% In 2023

Looking upon the experts who have have anticipated that a potential worsening of this trend in 2024 as the labor market softens amidst high-interest rates and persistent inflation. The report suggests that the tech sector will continue to be impacted by AI, mergers and acquisitions, and realignment of resources and talent.

Retail companies accounted for a large portion of job cuts, slashing 78,840 positions, marking a 274% increase from the previous year. Healthcare and product manufacturers, including hospitals, also eliminated 58,560 positions in 2023, representing a 91% increase from 2022.

Deteriorating market and economic conditions, store closures, bankruptcy, and AI were cited as top reasons for the surge in job cuts. Another survey revealed that 34% of employers did not award bonuses in 2023, the highest rate since 2019, reflecting challenging economic conditions.

Will it affect Indian Jobs/Workers and How?

The Deteriorating market and economic conditions would impact the economic conditions of the US. Being one of the strongest power in the nation, there is a speculation that it might also impact the developing countries like India. According to a report shared by Money Control, there is a 19% increase in overall hiring intent in India for 2024 compared to the previous year.

The report, titled 'India Decoding Jobs 2024', is released by recruitment platform Taggd has indicated positive sentiments in various sectors.

Manufacturing Sector Leading with 25% Hiring Intent

The manufacturing sector exhibits robust hiring intent, anticipating a 25% increase, showcasing a positive outlook for industrial expansion. Notably, manufacturing companies plan to hire 15-30% more graduates from the 2024 batch compared to the 2023 batch, indicating a positive trend in the sector.

Strong Focus on Talent Acquisition in BFSI Sector

In that report, the Banking, Financial Services, and Insurance (BFSI) sector stand out with a substantial 25% hiring intent, emphasizing a strong focus on talent acquisition in the financial domain.

Anticipation of Increased Demand in Automotive Industry

The automotive industry is set to witness a 20% surge in hiring intent, reflecting the sector's anticipation of increased demand.

Promising Outlook for Internet Business and Global In-house Centers

The Internet business and Global In-house Centre sectors share a promising outlook, with a significant hiring intent of 20%, highlighting the continued importance of technology and global operations, as per the report.

Sustained Growth in Pharmaceutical Industry

The pharmaceutical industry displays a 16% rise in hiring intent, emphasizing sustained growth in the healthcare sector.

IT Sector Exhibits Conservative 3% Hiring Intent Increase

The information technology (IT) sector shows a more conservative hiring intent increase of 3%, potentially reflecting a nuanced approach amid evolving industry dynamics.

Evolution of Work Modes and Anticipation of Diverse Hiring

A nuanced shift in work modes is anticipated in 2024, with the hybrid model strengthening its position at 60%. Work from office-only scenarios is expected to decline to 33%, while remote work remains steady at 7%, reflecting an evolving approach to work modes. The projected diversity percentages for the workforce signify a positive evolution, with an expected increase in female representation to 36%.

Shift in Hiring Practices

In 2024, companies are expected to move away from 'walk-in' hiring, preferring various sources such as professional networking, social media, internal referrals, company websites, consultants, campus hiring, and job portals.

Impact on IT Sector and Future Hiring Trends

Top IT services firms are projected to hire between 50,000 and 100,000 employees during fiscal year 2024, representing a significant decline from the net hiring of over 250,000 in the previous year. Further, the demand for tech talent is expected to continue from non-IT sectors, where digital initiatives are creating new opportunities.

PM Mod Emphasizes Job Growth

Last year, in October, Prime Minister Narendra Modi, distributed appointment letters to nearly 51,000 youths recruited in various government departments. During the event, he asserted that his government has enhanced employment opportunities in both traditional and emerging sectors such as renewable energy, the defence industry, and automation.

During his address, PM Modi highlighted the ongoing 'Rozgar Mela' organized by his government and BJP-ruled states, emphasizing their commitment to youth employment. Addressing the recruits virtually, he stated, "Today, India is equipping its youth with skills and education to harness emerging opportunities, generating new employment prospects across all sectors," reported Times of India.

Undestanding the dynamics of the Indian Job sector and looking at the new government policy shift, it suggest a positive hiring landscape for India in 2024, with various sectors showcasing optimism and adapting to evolving trends in work modes and hiring practices.