COVID-19 Effect: Organised private sector planning layoffs, salary cut
NEW DELHI: The organised private sector in India is planning to have major job cuts/layoffs due to the coronavirus pandemic and lockdown that have significantly impacted the economic activities, says a report.
According to the latest results of MyHiringClub.com and Sarkari-Naukri.info Layoff Survey 2020, 68 per cent of the employers surveyed have either started the layoff process or are planning to.
The online survey covered 1,124 companies across 11 industry sectors in 25 major cities. The survey was conducted between May 1 to May 10, 2020.
Among the surveyed organizations, 73 per cent said they have plans to decrease the salary of employees, 57 per cent said this layoff is temporary, while 21 per cent said they are doing permanent layoffs for at least 2 years.
Interestingly, 32 per cent employers did not have any job cut/layoff plans.
“All industries are suffering in the current pandemic situation and the pain is now translating into layoff in every industry at every level. Companies are even cutting salaries of those employees whom they are planning to retain.
“This crisis is very much temporary and once companies come out of this, new job creation and hiring will surely start,” said Rajesh Kumar, CEO, MyHiringClub.com & Sarkari-Naukri.info.
Kumar further said “industries like aviation, hospitality, travel, FMCG, retail, automobile & manufacturing will suffer more and will take longer duration to recover due to a halt in spending. Job cuts, salary reduction and business downfall are major reasons for spending less in the current situation.” The survey noted that the percentage of layoff is highest in Retail & FMCG sector at 49 per cent, followed by Hospitality / Aviation / Travel (48 per cent), Automobile / Manufacturing & Engineering (41 per cent), Real Estate (39 per cent), Power Sector (38 per cent).
As per the survey, employees with experience between 6-10 years are likely to witness highest number of layoff at 31 per cent, followed by those with experience between 11-15 years (30 per cent).
For employees with more than 15 years of experience, the likely layoff percentage stood at 21 per cent, while for junior level employees (experience between 1-5 years), it was 18 per cent.
The country is currently under a nationwide lockdown which was imposed in March to combat the coronavirus pandemic. The lockdown, extended twice, is scheduled to end on May 17.