foundit (formerly Monster APAC & ME), India's leading talent platform with over 90 million jobseekers and 7,000 recruiters, takes a closer look at the dynamic landscape of hiring trends witnessed in 2023. The trend report provides a detailed overview of industries and job roles that have thrived and those that faced challenges, along with a comprehensive outlook for 2024, predicting an overall hiring expansion of 8.3%.
Hiring activity slows in 2023 but showed signs of recovery last month
According to the latest foundit Insights Tracker (fit) data, hiring activity in 2023 is 5% lower than in 2022, indicating a slowdown in the job market. However, the index also shows a 2% increase in the last month of 2023, suggesting that the hiring scenario may turn around for the better. The economy shifted towards the end of 2023, breaking the previous trend that had been consistent since mid-2022. The job market entered a phase of fluctuation, with both turnover and hiring rates stabilizing. Despite the decline in job openings, the imbalance between job openings and hiring indicates that companies continue to have difficulty finding the right talent.
Recovery in consumer spending and digital innovation to drive growth in key sectors in 2023
In 2023, several sectors showed remarkable resilience and growth, becoming signs of success amid a challenging environment. The shipping industry surged by 28% by capitalizing on the increase in global trade and deftly managing supply chain disruptions. At the same time, retail and travel & tourism both recorded an increase of 25%, benefiting from a recovery in consumer spending. The advertising, market research and public relations (PR) sector recorded an increase of 18% due to the rise of digital marketing and e-commerce. NGOs and social welfare services recorded a steady growth of 12%, reflecting their continued commitment to social issues. Office equipment/automation recorded an increase of 6%, indicating the growing importance of automation in streamlining business processes. The oil/gas/petroleum and power sectors recorded growth of 4%, while clothing/textile/leather and gems and jewellery showed moderate growth of 1%.
Skills gap, supply chain disruptions and inflation hit IT, education, manufacturing, FMCG
Conversely, certain sectors faced significant challenges and recorded negative growth. IT hardware and software experienced a decline of 18%, reflecting challenges due to saturated markets, skills gaps, and global competition. Employment also declined in the healthcare, pharmaceutical, biotechnology and life sciences sector (-12%) and banking/financial services, insurance sector (-9%). Manufacturing faced disruptions with a decline of 8% due to supply chain issues and rising input costs. BPO/ITES, engineering, cement, construction, steel, and education also faced challenges with a decline in employment from 8% to 4%. FMCG/food and processed food declined by 3%, impacted by inflation and changing consumer habits.
human resources Managers Stand Out as Companies Prioritize Talent Management and Engagement
Within organizations, functional roles have changed significantly, reflecting strategic responses to the changing business environment. HR and administrative roles have increased in demand by 9%, highlighting the need for efficient workforce management and employee engagement strategies. The hospitality and travel sector has shown a similar growth trajectory, with a notable increase of 9%. Meanwhile, customer service roles have decreased by 24% due to increased adoption of automation and technology within customer service functions, mirroring the industry-wide trend.
Finance & Accounting roles held steady with a flat 0% growth rate, indicating stable hiring within this functional area. In contrast, Sales & Business Development and Legal roles saw a slight decrease of 1%, indicating relatively weak demand for professionals in these sectors over the past year. Similarly, Engineering/Manufacturing saw a modest decrease of 3%, reflecting the challenges facing this sector of industry, which may be affected by factors such as supply chain disruptions and global uncertainty. Purchasing/Logistics/Supply Chain took a 5% hit, further highlighting the knock-on effect of global economic fluctuations.
Senior management hiring saw a significant drop of 12% overall, but saw an increase of 9% in the last month, indicating a possible shift or recovery in demand for these roles, especially in the manufacturing and BFSI sectors. This trend may indicate a strategic re-evaluation of leadership structures within organizations, suggesting continued sustained growth. Meanwhile, software, hardware, and communications roles saw a drop of 13%, likely due to technology saturation and changing industry demands.
Emergence of second-tier cities as potential growth engines driven by cost competitiveness
2023 saw a notable shift in geographic hiring patterns driven by cost considerations and improved quality of life in smaller cities. Ahmedabad, which grew by 6%, emerged as the top hiring hub, attracting companies with its talent and cost competitiveness. Meanwhile, traditional hiring megacities such as Bangalore and Pune saw declines of 16% and 13%, respectively. The decline in these IT-centric cities can be attributed to the skills gap, highlighting the urgent need for continuous upskilling and adapting to market demands. Meanwhile, smaller cities such as Baroda (-1%) and Coimbatore (-5%) weathered the storm with moderate declines, demonstrating their cost competitiveness and future growth potential. Notably, Kochi (0%) and Jaipur (0%) maintained flat growth, demonstrating their resilience. Delhi National Capital Region, Chennai and Mumbai saw employment declines of 5%, 8% and 7%, respectively, while Hyderabad topped the list with an 11% decline. These cities may need to address industry-specific issues or reevaluate their strategies to capitalize on new opportunities.
Outlook 2024: Positive job market trajectory and emerging trends
As businesses prepare for 2024, FoundIt predicts overall job growth to be 8.3%, with Bangalore seeing an 11% surge among metros. By industry vertical, key sectors such as manufacturing, BFSI, automotive, retail and travel & tourism will experience job growth.
- Anticipated technological advancements: Demand for talent with expertise in emerging technologies is expected to increase in 2024. While there may be some initial slowdown in IT hiring, demand for AI/ML, data science, and cyber security professionals is expected to soar. These skills are essential to enable digital transformation, innovation, and security across sectors.
- Sustainability initiatives and green practices: In industries with a focus on sustainability, roles related to green initiatives and eco-friendly practices are prioritized. These roles help organizations assess and manage environmental, social, and governance risks and opportunities.
- Strategic guidance in an evolving environment: Consulting firms are seeking professionals with diverse skill sets to provide strategic guidance in an evolving business environment. These professionals help organizations navigate challenges and opportunities arising from technological advancements and regulatory changes.
- Demand for financial expertise will increase: Demand for financial analysis, risk management, and compliance professionals is expected to continue in 2024. These professionals help organizations manage their finances, mitigate risk, and comply with regulatory standards.
- Partial employment: With skilled talent limited, the focus is shifting to partial employment, leveraging expertise without full-time employment to increase agility and operational efficiency.
- Talent Strategy 2024: There will be a greater focus on skills assessment, training and career progression, and exploring and integrating AI tools along with skills will be essential to stay relevant and competitive in the evolving environment.
Sekhar Garitha, CEO of Foundit, Said“2024 marks a transition from an era of resilience to one of significant growth in certain sectors. It requires a fundamental rethink of our approach to recruitment rather than simply expanding our teams. In this dynamic environment, prioritizing investments in cutting-edge technologies such as AI, fostering sustainability practices and seeking strategic guidance will be key to success. Despite the growing role of automation, it is important to recognise that the human touch remains unmatched in a technology-driven world, highlighting the importance of upskilling efforts. Companies that proactively invest in their employees beyond traditional boundaries, promote inclusivity and lead the way in sustainable practices will be able to attract and retain the best talent in this changing employment landscape.”
Reporting Period
Data is for the period January 2023 to December 2023.
