From Layoffs to Bounce Backs: Adapting to Economic Downturns

The journey of India’s job landscape in the last few years has been a roller coaster, driven by domestic and international events. With the emergence of technology, the wave of digital transformation, and the unpredictable events of a global scale, companies have had to constantly adapt, leading to both growth and contractions in workforce numbers.

The Layoff Trend in the IT Sector

The tech industry hasn’t been spared from the effects of the shifting economy. Prominent companies have opted for workforce reductions, with over 4,000 to 5,000 employees being laid off recently. This isn’t a standalone case, as Accenture also reported the removal of approximately 19,000 employees from their roles. Startups, despite being backed by tech giants, aren’t immune either. To paint a clearer picture of the intensity, an average of 555 employees in various industries faced job loss every day over the past two years according to the latest data by 

The Larger Impact

Broadening the lens, other players in various sectors felt the strain as well. Microsoft, for instance, trimmed the workforce of its social media platform, LinkedIn, affecting around 668 employees. Another statistic shows that in 2022, nearly 11,833 employees in Indian startups across different sectors found themselves out of a job.

Support Systems and Government Initiatives

In light of these trends, the Indian government and private sectors have made efforts to provide a safety net for those affected. Temporary income support such as unemployment insurance and redundancy payments have been provided. The Industrial Disputes Act (IDA) has provisions permitting layoffs while ensuring a balance between employee and employer interests. Efforts are also being put to improve the Ease of Doing Business, with guidelines and strategies being issued by multiple governing bodies.

The Silver Lining

Not all is bleak, though. Many who found themselves out of work didn’t remain unemployed for long. Data by Forbes India suggests that 40% of those laid off typically find new employment within a month, and an encouraging 80% secure jobs within three to four months.

Global Influences and Challenges

It’s important to contextualise these events within the global environment. The pandemic introduced a range of challenges, impacting India’s economy and formal job market. Further, global economic challenges and the US Federal Reserve’s decisions have introduced more complexities, impacting sectors like IT. Additionally, the ongoing conflict between Russia-Ukraine & Israel-Palestine is causing ripples in the global market, affecting nations far and wide, including India.

Adapting to economic downturns and market shifts requires a multifaceted approach. While layoffs are an unfortunate side effect of these shifts, the combined efforts of the private sector, governmental initiatives, and the resilience of the Indian workforce are noteworthy. As the landscape continues to evolve, it’s crucial for professionals and companies alike to stay informed, agile, and ready to adapt.