The Tribune - Spectrum

, March 17, 2002
Lead Article

No scarcity of jobs . . .       but where are the right people?

It is said that the job market is in a recession and ‘good’ people, who could job hop at will until a few years ago, seem to be caught in between jobs. The perception is that not only has the job volume gone down dramatically, the pay and perks too have dwindled to a trickle.
Prerana Trehan checks out the corporate scenario and finds out that the nature of jobs has changed as has the suitability of people wanting them.

AS the world economy finds its feet amidst the rubble of the World Trade Center, corporate India is rewriting definitions. Careers are no longer what the textbooks once said they were; neither are corporations. For some the unlearning-relearning process is an inescapable consequence of new economic realities; for others it is a lesson in survival. When the going gets tough, the tough adapt.

Naturally, the winners are the ones who are the quickest to change tracks: A lesson that has not been lost on business houses, notably in the software sector, or on thousands of workers who are willing to consider non-traditional careers.

The new realities

Once upon a time workers had a 'till death (or retirement, whichever happened first) do us part' pact with their employers. Once a person joined an organisation, his career path could safely be predicted for the next 20 years, if not more. Security and stability were prized virtues in a job, making a safe government job a much-sought-after option. Career meant joining a government office as a probationary officer and then waiting patiently for a succession of time-bound promotions, secure in the knowledge that once you had been hired you could not be fired. And of course, no one looked for another job.


To a 20-something reader of this article, such a scenario would seem to date back to the time when tyrannosaurus rex roamed the earth. And not without reason. Careers today are as far removed from stability as they could get. This is especially true of newer opportunities. While jobs in traditional sectors like manufacturing and healthcare are not exactly what they were a few years ago, it is the jobs in newer segments like IT-enabled services, retail, BPO, and entertainment, which are reinventing attitudes. Relatively new, these industries are in the growth phase and being services-driven, their manpower requirements are high.

Even though there are jobs in non-traditional sectors like contact centre, merchandising, retailing, customer interaction and transaction processing, no one knows how long they will exist. Yet they are finding takers by the thousands. A lack of options may have something to do with this as also the fact that there are very few entry barriers. Some contact centres, for instance, don't insist on any formal qualifications. A good command over English and computer literacy is all that is required. "We even have housewives and retired persons working for us," says Shikha, a trainer with e3R, a call centre based in Panchkula. Many of those who join are not looking for long-term relationships, an attitude that is reflected in attrition rates that vary between 12 per cent to 35-40 per cent in the call centre industry. Handling inbound and outbound calls and data entry operations is too boring and stressful to be pursued for long. This is especially true of lower level jobs. Most call centre agents are in the 18-24 age group and study during the day - they work nights - and view their jobs as a comfortable way to earn some extra cash while they gather the experience that would enable them to move on to greener pastures. A bigger pay packet or a more challenging assignment is enough to lure away these youngsters, sometimes even to unrelated industries. Take the case of Vikas, 28, a hotel management graduate who started his career with the Taj Group of hotels, quit within a year to join GE Capital as a call centre agent and after two years joined the sales department of Max New York Life Insurance.

A mindset change

Flexibility and fluidity, coupled with the emergence of new sunrise sectors and the demise of old ones, makes it impossible to predict where your career is headed. Even as never-before opportunities emerge in newer segments, increasingly jobs in the traditional sectors are drying up and also becoming less secure. "There is no doubt that the industry is in recession but when I say this I am talking about traditional industries. New jobs are being created and IT-enabled services are very big employers here", says Gautam Sinha, CEO, TVA Infotech. Rapid expansion, closure, downsizing and restructuring in the corporate sector also increase the level of uncertainty. Risks are inherent in the new-age careers and an ability to manage these is an undeniable asset. Experts agree that mindsets have to change. MBAs are today competing with plain graduated for entry-level jobs. "An MBA can no longer expect the industry to molly-coddle him", avers Anand Bhagat, GM Omam Consultants, a placement agency. Agrees Reena Dayal, HR Head, Lifetree Convergence Ltd, a software company, "I think there is a mindset change to undergo. Fresh graduates need to equip themselves with practical skills and on-the-job experience, even if it means working for free. Many youngsters today are actually knocking on companies' doors, ready to do freelance project work, many times for free. Companies are and hopefully will continue to respond to more such initiatives."

Fear of recession and the rumours or reality, as the case maybe, of layoffs has made the job market a buyers’ market. Employers insist on quality of the workforce they hire. Good and experienced workers are still as much in demand as they were at the height of the IT boom. In contrast to the newer sectors which are welcoming freshers enthusiastically and paying more than their qualifications would have commanded a few years earlier, traditional sectors are more selective. Here qualifications and experience are what clinch jobs, especially in the middle-level. Says Reena Dayal, "If middle-level executives are good or excellent in their work, chances are they would be having a job in hand. If they are average or above average, I think they need to introspect and reskill themselves in a line which either complements their core skills or experience or is in line with their personal liking." A sentiment echoed by Drish Sandhawalia, a consultant who places software professional in companies abroad, "You can't afford to be the jack of all trades, you have to be the master of one."

The companies, too, are becoming leaner and meaner than before. This means they hire less and focus on getting more out of the ones already on their payrolls. The emphasis is, undoubtedly, on increasing efficiency. "Our employee-revenue ratio is the highest in the industry," says Vinod Sawhny, Managing Director, Spice Telecom, with pride. Increasing the productivity of each employee is obviously on the agenda. A positive fallout of this is that companies go all out to retain the employees they consider efficient. Spice, for example, awards its star performers with trips abroad. The accent is clearly on differentiating the chalk from the cheese.

Software emphasises core competencies

It is back to the basics as far as the software sector is concerned. That the dotcom bubble would burst was a foregone conclusion, when it finally happened, it was the me-too ventures that led the dotcom funeral procession. Ventures like and, that had a sound business policy and viable profit-making plans are still very much in business. So while the fittest survived, the not-so-fit went under. As a natural corollary to this theory, manpower requirements emphasise core competencies. Says Vinod Kumar, Country Manager, Boston Software Consultants, "People who called themselves experts with six months training are out of jobs. If they are good opportunities still exist". No longer are six-month and one year diplomas the passports to greener pastures abroad or even in India. Knowledge commands the kind of respect it rarely did earlier. When the industry overcomes the recession and starts hiring again, an event that experts feel is likely to occur in the second half of this year, those with experience will be much sought after. "When job opportunities begin swinging for job hunters in the second half of this year, it will be especially gratifying for those who are equipping themselves with meaningful work experience. In fact, people who have accepted pay cuts/lower salaries and stuck to jobs in the past one to two years have been wise because when the market opens up, those with relevant experience will be hot property," opines Reena Dayal. And going by the fact that the attrition rate in the IT industry is down to 4 per cent from a previous high of 20 per cent, it is obvious that not many are leaving jobs.

Other major employers

While the software, more specifically ITES (IT enabled services), is still the biggest employer, other sectors that are on an upswing include insurance and telecom. The growth rate in the telecom industry stands at a healthy 70 per cent with Punjab leading the rest of the country with a 75 per cent growth rate, according to Vinod Sawhny. This rate is expected to increase to 80 per cent. The insurance story is equally heartening. The Indian insurance market is projected to hit $ 25 billion by 2010. According to some estimates, the industry is expected to generate 500,000 jobs in the next five years. With the opening of the insurance sector to private players, some interesting, new job opportunities have emerged such as surveyors, claims processors, agents, underwriters and actuaries.

More realistic salaries

The lack of euphoria surrounding the conditions prevailing in the job market has undoubtedly increased the pressure on the employees and also brought with it a sense of realism. Most are now vary of promises made by managements. This sense of realism is also reflected in the pay structure prevailing in the industry. Salaries are today more realistic than they were, say, two years ago. "Nowadays salaries are normal and at a level where they ought to be," says Navyug Mohnot, Managing Director, Quality Assurance India Ltd. Huge pay packets and hefty signing amounts that were seen during the initial phases of the IT boom are now a thing of the past. There are two interesting factors responsible for the realignment of salaries in keeping with a realistic assessment of the trends in the industry. First, companies don't mind paying, sometimes even big amounts, for relevant skill sets and for prior experience in executing a job similar to the one for which an executive is hired. Second, in many cases a salary is not a fixed amount that an executive takes home on the first of every month. In many companies there is a mindset shift to incentives or variable pay that is based on what the company decides the particular employee is worth, an assessment that depends on how well the employees performs. Another way of saying that you get paid for what you are worth. Apart from this another thing that has been responsible for the mood of realism is that "for the first time people have been exposed to the realities of capitalism in the corporate sector where if you can make big money during an upswing, you can also be without work during a downturn," according to Gautam Sinha.

Salary cuts have become more common than salary hikes. Non-performers sometimes have to face a 10-15 per cent drop in salaries. The days of employees calling the shots and demanding sky-rocketing salaries are over, at least for the time being. While a few companies are resorting to such drastic measures as pay cuts, many have decided against salary hikes. A fact borne out by the statistics given by the Annual Salary Increase Survey report recently released by the global consultancy firm Hewitt Associates. According to the report, the hikes across employee groups in India will range between 9.7 per cent to 11.7 per cent in 2002, a decline from last year when the increases were between 10.2 per cent and 14.5 per cent. In fact, for the first time in the last decade or more, corporate India is likely to see a single digit increase in salary. The salary increase in 2001 and the projected increase in 2002 is 9.7 per cent and 8.5 per cent in banking, 15.5 per cent and 12.2 per cent in software and 18.9 per cent and 12 per cent in telecom, respectively. Further more, more than 11 per cent of the 310 companies surveyed are likely to put a complete freeze on salaries this year.

In keeping with the trend of paying for performance, 97 per cent of the companies surveyed say they already have a performance appraisal system in place. Says Ravi Virmani, Managing Director, Hewitt Associates, South Asia, "The concept of across the board hike has become extinct in the private sector." While star performers can expect an increase of 18.4 per cent or so, below average performance may lead to an increase of 3.9 per cent only.

Overseas employment

The overseas job market, too, is no longer what it was a few years earlier, a lesson some one lakh Indians who were laid off or benched when recession hit the American economy have learnt only too well. If cautious optimism is the mood prevailing in the domestic job market, in the overseas market, it is still one of fear and pessimism. This is also true of those Indian companies which handled off-shore projects, which were directly affected by the pessimism of the American industry. So while the Indian product companies continued hiring, the project companies froze recruitments. Says Bal Sehgal, CEO, Quark Media House (India) Pvt. Ltd. "Not many overseas companies are hiring these days and finding a job overseas is more difficult for freshers today than it was two years ago." Experts feel that the scenario where Indian professionals were being placed by the thousands in companies in the USA, is not likely to repeat itself. One reason for this, says Drish Sandhawalia, is that while earlier embassies and the INS (Immigration and Naturalisation Service) scrutinised only the candidates placed abroad, now they also scrutinise the companies sponsoring HIB visas. Hence, it is difficult for overnight companies to set up shop in the USA and call people there. Now only genuine companies and candidates are welcome.

The US economy is expected to improve by the second half of this year. Even when it happens, the demand for software professionals is expected to build up slowly. Again, the overseas employers emphasise relevant skill sets. No longer can diploma holders from computer institutes like NIIT, Aptech etc, hope to get HIB visas. Only good software professionals with degrees from top-of-the-line institutes like the IITs and with hardcore experience can hope to see appointment letters from abroad. "Even the attitudes of our guys should change. Right from the time they are out of class 12, their body is here and soul in the United States. That won’t get them jobs, only knowledge can," says Vinod Kumar of Boston Consultancy. The skill sets in demand, too, have changed. Core IT skills will be in demand. Web-based designing is out, says Drish Sandhawalia. However, the demand for UNIX systems administrators, network administrators, DBA, C, C++ and Oracle programmers, XML professionals as also d-com professionals is expected to pick up.

An upswing in some sectors in the growth phase is today counter-balanced by a downturn in others. The trick lies in identifying new opportunities that are emerging in sunrise sectors and playing a waiting game till such time as the recession gives way to a new dawn in the traditional ones. What the industry needs till then, as always, is a few good men.