| Recession has hit the job market and fresh graduates are worried |
Being a fresher in any industry, at any point of time is no duck soup. An ailing economy and a sluggish job market coupled with recession will only add to the woes of the young job seeker. With experts predicting that a significant part of 2009 will be mired in recession, the average soon-to-be-graduate has little to look forward to.
Analysts confirm that job markets across sectors are in a trough, and will continue to remain so for a while. While top-notch campuses in the country — be it engineering colleges or B-schools — registered sound placement trends, tier-II and tier-III campuses across education sectors did abysmally. Placement cells in most colleges had a tough time getting corporates to even visit their campus, let alone conduct recruitment.
In the technology sector, several companies picked up scores of bright young graduates-to-be in the hope that the recession would undo itself by the end of 2009. However, considering that several students of the 2008 batch have still not been given joining dates, even those who are “placed” are not entirely optimistic.
Raghav Kirit, a 2008 batch graduate of Electronics and Communication Engineering, had got a campus placement offer from Wipro Technologies.
The company sent him and his batchmates an offer to join the BPO services wing of the company.
“Why will I agree to work in a BPO when I am qualified to do much more than that? Similarly, many mid-size companies have not even given joining dates to our batch. When we have not been absorbed, how are they making offers at all these other colleges?” he asks.
The story rings a similar tone, across industries. The Hindu EducationPlusspoke to experts, colleges, academics and students across sectors to find out how the recession or the economic downturn will affect their careers.
From core industries such as manufacturing and engineering to media and retail, in the absence of growth, the job market is a tough place to be. According to a survey conducted by Naukri.com titled “Job Speak,” the overall job index fell from 1000 in July to 781 in October, which is a 21.9 per cent decline. Over the last three months of 2008, key sectors such as real estate, banking, finance, IT and retailing — all of which were pumping jobs into the market for fresh young graduates — showed a decline; while telecom, pharma and hospitality emerged as attractive options. While this report is not reflective on the overall state of any industry, it speaks primarily about recruitments. All the metros, which provide for a large chunk of jobs, saw a dip in the supply of new jobs to the tune of 16 per cent. Across most functional areas, the job portal’s report records a 15 to 20 per cent decline.
Sampath Shetty, vice-president, permanent staffing business unit at TeamLease, said the worst hit sectors, job-wise, in 2008 were realty, construction, broking, and investment banking. He points out that for freshers, the job market is likely to remain grim across sectors. “There will be some hiring in sectors involving telecommunication, FMCG, insurance and the pharmaceutical sector – these are doing well.”
“The good thing about the recession is that more students are opting for core courses. Last year, half the electrical engineering students went for IT jobs for the humongous pay packets. Now, the trend is reversed with almost everybody sticking to their trade,” says Roshni S., a student of BMS College of Engineering.
Several colleges showed positive placement trends in terms of manufacturing jobs, both in number of offers made and pay packets. However, tier-II and tier-III colleges fared badly. Unlike their IT counterparts, the manufacturing sector may not have declared a “recruitment freeze” but jobs will not be very easy to come by either.
According to a survey conducted by global consultancy firm KPMG, the BRIC region (Brazil, Russia, India, China) is showing signs of “buoyant levels of confidence regarding the prospects of business activities during 2008.”
However, with funding for projects on a low, several projects will be slowed down, which in turn will cut the demand for any kind of fresh recruitment. Architects and civil engineers will see a minor trough, but it is not expected to last long, Sarayu Krishnan, analyst at an HR hiring firm, says.
The Naukri.com survey quoted above records a 25 per cent dip in software. The hardware sector saw a dip in new jobs, while construction and engineering went down by 22 per cent since July, 2008.
“Public infrastructure projects and big manufacturing companies such as Larsen and Toubro will continue to recruit. However, these numbers have always been marginal,” Mr. Shetty explains. The telecommunication sector has been doing well, and will continue to recruit in the technical profiles too.
This “sunshine sector” will see a more profound slump in 2009. Though IT majors posted good numbers on campus hiring, only time will tell how many will be absorbed. Last year’s track record with several mid-size companies not delivering on offers made, other majors such as IBM cutting flab at the eleventh hour with a “surprise test” and Wipro Technologies’ googly offer to join its BPO, has left freshers suspicious of any offer made.
While tier-I colleges in cities joined the IITs and IIMs in securing good jobs for their students, tier-II colleges fared badly. PESIT CEO Jawahar D. said that below-average students would have a tough time this year. “There is a 25 per cent drop in recruitments in almost all top companies. Even good colleges will find themselves on the borderline,” he said in a recent interview.
Mr. Shetty says: “Given that there have been retrenchments, there are plenty of ‘experienced’ candidates and 2008 freshers in the market. Employers will be spoilt for choice and the average fresher will have a tough time.”
Career counsellors recommend using the time to pursue higher education or acquiring additional skills in time for the market’s rise period.
Have management jobs lost their sheen? Not yet, experts say. The most coveted profiles such as investment banking and the financial sector in general will not recruit in large numbers, but that will simply force the graduate to diversify into tertiary sectors, where there is a demand for talent. Needless to say, the impact will vary depending on how much value your MBA commands in the market.
“For students from tier-III colleges, the next six to eight months will be difficult because companies are uncertain where they are headed. Students will have to wait or make do with less-paying jobs,” says Ramesh Venkateswaran, Director, SDM-IMD, a B-school in Mysore. He says that companies have limited their intake and the college this year has invited 60 to 70 companies, compared to 38 companies last year.
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