The TeamLease Employment Outlook Report: Quarter-3, 2011-12
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The TeamLease Employment Outlook Report: Quarter-3, 2011-12

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The quarterly TeamLease Employment Outlook Report provides human resource policy and decision makers a forward looking tool that tracks hiring sentiments in the market. The report carries an insight ...

The quarterly TeamLease Employment Outlook Report provides human resource policy and decision makers a forward looking tool that tracks hiring sentiments in the market. The report carries an insight into what businesses of various sizes – across the country and across industry sectors – have on their talent acquisition anvil for the immediate next three months. The Employment Outlook Survey is carried out, and the analysis done, in the preceding quarter.

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The TeamLease Employment Outlook Report: Quarter-3, 2011-12 The TeamLease Employment Outlook Report: Quarter-3, 2011-12 Document Transcript

  • inTouch analytics http://be-in-touch.comTeamLeaseEmployment Outlook Report Quarter-20, October-December 2011
  • Contents1. Preface2. Executive Summary3. Project Objectives4. Index definitions 4.1. Employment Outlook Index 4.2. Employment Trend Index 4.3. Business Outlook Index 4.4. Business Confidence Index5. Employment Outlook 5.1. Net Employment Outlook 5.2. Net Employment Outlook Growth – by sector 5.3. Net Employment Outlook Growth – by city6. Business Outlook 6.1. Net Business Outlook 6.2. Net Business Outlook Growth – by sector 6.3. Net Business Outlook Growth – by city7. Hiring Intent 7.1. Hiring Intent by Location 7.2. Hiring Intent by Hierarchy 7.3. Hiring Intent by Functional Area8. Other Trends 8.1. Employment Outlook Index – city-sector drilldown 8.2. Business Outlook Index – city-sector drilldown 8.3. Attrition trends by sector 8.4. Attrition trends by city9. Insights 9.1. Sentiment Trend Forecasts 9.2. City trend forecasts for Sentiment10. Annexure 10.1. Research Methodology 10.2. Sample Design & Data Collection 10.3. Reasons for Attrition – the employer perspectivehttp://be-in-touch.com
  • 1. Preface The quarterly TeamLease Employment Outlook Report is a forward looking tool for human resource policy and decision makers, reflecting business sentiment for hiring across cities and sectors. The report carries a snapshot of business hiring sentiment for the immediate next three months with survey and analysis being carried out in the preceding quarter. The Employment Outlook Survey spans eight industry sectors and eight cities across India. The survey covers small, medium and large companies across these sectors, studies attrition and employment trends, and gleans information on hiring sentiments, all this covering different locations, hierarchical levels and functional areas. This edition of the Employment Outlook Report takes cognizance of the sentiment swing across cities and sectors and attempts a high-low trend analysis to look at which city-sector clusters have closely correlated Employment and Business sentiment trending. Results indicate a diverse pattern with Bangalore and Pune exhibiting good symmetry. With the most critical drivers that influence hiring being tracked quarter on quarter, the Employment Outlook Report is the only one of its kind seeking to deliver high impact hiring decision support to its stakeholders – Business & HR heads, Senior Management as well as industry policy makers.http://be-in-touch.com
  • 2. Executive Summary • The stable atmosphere of employment and business sentiment built over the past three quarters was belied by sentiments expressed by respondents for the current quarter. There was an across-the-board drop in indices – the Employment and Business Outlook indices (3 percentage points each), as well as across most cities and sectors. And the drops are significant enough (up to 9 points) to signal extreme caution in job markets over the immediate next quarter. • The discreet signs a few sectors such as IT and ITeS had exhibited during the last quarter have proved to be contagious for this coming quarter. IT has pressed the panic button with a 7-point drop in Employment sentiment and an 8-point drop in Business sentiment. While all other sectors have experienced significant drops in Employment sentiment – except for Infrastructure and Financial Services with a 2-point drop each in Employment indices – only Retail & FMCG and Manufacturing & Engineering show an appreciable fall (6-points each) in Business sentiment. • Sliced by cities, the analysis reveals an employment sentiment sink: Delhi and Bangalore witness a 9-point drop, each, in Employment Outlook index, while Pune drops 8 points and Chennai, 7 points; others follow closely. Kolkata plays the underdog with a counter-trending 5 point rise in Employment index while Hyderabad has long dug its heels in at 60 index points. Chennai, Bangalore and Pune – in that order – bring up the rear with 7, 6 and 5 percentage point drops in the Business Outlook index. • The negativity with hiring sentiment paints the geographic patterns red – Metros and Tier-2 cities lose 3 points each to close the year at 88 and 17 points, respectively. Tier-3 towns lose 2 points and are at 10 index points while rural stays with its consolatory lone index point. Likewise, hierarchical hiring patterns are broadbrushed with falling index movements as well – Junior and Mid-level hiring are projected to be down 4 points each while Entry-levels will suffer a 2- point loss. Senior profiles are well protected in their niche, which sees a single point drop to a stable 24 points. • The brunt of a sentiment swing, possibly due to concerns about the global economy, is borne by two of the most premium of all functional areas: IT (6 points down) and Engineering (4 points down). Sales, Marketing and Customer Service keeps its top position at 79 points despite a 3-point fall. There is a 2-point drop across all other functional areas. • A city-sector trend analysis was seen to be in order given the unforeseen drop in sentiment. Bangalore and Pune are found to be two prime examples of a symmetrical trending pattern between the Employment and Business index movements. Delhi comes close to the above two cities in terms of symmetry, while Chennai exhibits complete disconnect between the two indices.http://be-in-touch.com
  • 3. Project Objectives The Employment Outlook Report aims at – • Providing forward looking estimates of hiring sentiment and thus enabling its users with a tool to make effective hiring / people decisions for the immediate next quarter. • Providing *Hiring Sentiment Intelligence* for different industry sectors, business sizes and geographies, as well as across hierarchical levels and functional areas. 4. Index Definitions • Employment Outlook Index: The Employment Outlook Index is computed as the difference in the proportion of respondents who report an increase in hiring needs and those who report a decline in hiring needs over the next three months. • Business Outlook Index: The Business Outlook Index is computed by subtracting the percentage respondents who say business in the next three months is likely to decrease from the percentage who say it will increase.http://be-in-touch.com
  • 5. Employment Outlook 5.1. Net Employment Outlook 5.2. Net Employment Outlook Growth – by sector 5.3. Net Employment Outlook Growth – by cityhttp://be-in-touch.com
  • 5.1 Net Employment OutlookThis quarter witnesses a significant dip in the Net Employment Outlook index compared withthe last. The Index is the difference in the proportion of respondents reporting an increase inhiring needs and those reporting a decline for the quarter in question.Quarter Period (Figures in percentage) Increase Decrease No Change Net Employment Outlook 20 Oct—Dec 2011 72 1 27 +71 19 Jul—Sep 2011 76 2 22 +74 18 Apr—Jun 2011 78 4 18 +74 17 Jan—Mar 2011 74 5 21 +69The 3 point dip in the index is due to a substantially higher percentage of respondentsindicating they would have no change in hiring this coming quarter. Almost proportionately,there was a fall in the numbers that indicated they would increase hiring and the index fell tojust a couple of percent points above the year’s low.[Shaded cells have significant increases (gray) /decreases (red) in Index.]http://be-in-touch.com
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  • 5.2 Net Employment Outlook Growth – by sectorMost – 6 out of the 8 – sectors reported negative growth in the index, with the tech industrybearing the brunt of the fall almost entirely – IT, ITeS and Telecom experienced sharp dropsfrom the previous quarter’s levels. Financial Services and Infrastructure marginally improvedindex values. Sectors (Figures in percentage) Quarter Net Increase / Decrease 20 19 18 17IT 80 87 91 70 -7ITES 82 90 94 64 -8Financial Services 55 53 56 62 2[FS]Retail & FMCG [R&F] 70 72 70 68 -2Infrastructure [INF] 68 66 63 60 2Manufacturing & 53 55 53 82 -2Engineering [M&E]Telecom [TEL] 81 87 86 64 -6Healthcare & 67 70 65 73 -3Pharma [H&P]For IT and ITeS, this has been the second consecutive quarter indices dipped, and the dips aresharper this time round. The index value dipped after two stable quarters for Telecom, on theother hand.http://be-in-touch.com
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  • 5.3 Net Employment Outlook Growth – by citySentiments fell across cities like nine pins. Except for Kolkata, where the index had a significantrise, and Hyderabad, where it stood ground, the index suffered significant drops in value in allother cities. Sectors (Figures in percentage) Quarter Net Increase / Decrease 20 19 18 17Mumbai [Mum] 67 72 74 69 -5Delhi [Del] 61 70 69 67 -9Bangalore [Blr] 79 88 86 83 -9Kolkata [Kol] 61 56 60 63 5Chennai [Chn] 63 70 72 67 -7Pune [Pun] 70 78 76 79 -8Hyderabad [Hyd] 60 60 61 58 -Ahmedabad [Ahd] 67 72 70 73 -5With this loss in index values across 6 cities, the stability seen over the past two quarters isnegatively affected. Delhi takes a big beating and ranks just above the lowest scoring city,Hyderabad although, Bangalore and Pune – which are equally badly hit – retain their respectiveranks this quarter.http://be-in-touch.com
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  • 7. Business Outlook 6.1. Net Business Outlook 6.2. Net Business Outlook Growth – by sector 6.3. Net Business Outlook Growth – by cityhttp://be-in-touch.com
  • 6.1 Net Business OutlookWith a significantly higher percentage of respondents indicating a ‘no change’ scenario the NetBusiness Outlook index drops by 3 percent points.Quarter Period (Figures in percentage) Increase Decrease No Change Net Business Outlook 20 Oct—Dec 2011 73 1 26 +72 19 Jul—Sep 2011 77 2 21 +75 18 Apr—Jun 2011 80 4 16 +76 17 Jan—Mar 2011 78 5 17 +73This stagnant sentiment related to business outlook brings the index to its year’s low. Also, thepercentage of respondents who report an increase in hiring requirements this coming quarter isconsiderably lesser than during the previous low.http://be-in-touch.com
  • 6.2 Net Business Outlook Growth – by sectorAs during the previous few quarters, sector indices for business outlook drop by a lesser margincompared with the employment index. Further, a few sectors actually up their quotient, withInfrastructure notching up the smartest uptick for the quarter. Sectors (Figures in percentage) Quarter Net Increase / Decrease 20 19 18 17IT 82 90 94 77 -8ITES 77 79 80 59 -2Financial Services 55 52 49 55 3[FS]Retail & FMCG [R&F] 79 85 88 69 -6Infrastructure [INF] 66 61 60 67 5Manufacturing & 58 64 63 82 -6Engineering [M&E]Telecom [TEL] 58 57 55 47 1Healthcare & 65 63 65 76 2Pharma [H&P]IT and Retail continue in the downward trajectory they set themselves last quarter andManufacturing falls significantly below a 4-quarter high it had achieved earlier this year.http://be-in-touch.com
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  • 6.3 Net Business Outlook Growth – by cityAn across-the-board dip in business sentiment pushes down indexes or all cities. Chennai,Bangalore and Pune suffer the biggest losses, while Delhi and Ahmedabad also experience fairlysignificant dips. Sectors (Figures in percentage) Quarter Net Increase/Decrease 20 19 18 17Mumbai [Mum] 63 65 63 59 -2Delhi [Del] 47 51 52 51 -4Bangalore [Blr] 74 80 81 79 -6Kolkata [Kol] 68 69 70 75 -1Chennai [Chn] 75 82 81 77 -7Pune [Pun] 79 84 85 85 -5Hyderabad [Hyd] 74 76 80 79 -2Ahmedabad [Ahd] 70 74 71 76 -4While city-wise responses are grimmer than sectors, the sentiment for business outlook is notas low as that for employment.http://be-in-touch.com
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  • 9. Hiring Intent 7.1. Hiring Intent by Location 7.2. Hiring Intent by Hierarchy 7.3. Hiring Intent by Functional Areahttp://be-in-touch.com
  • 7.1 Hiring Intent by GeographyThe general negative sentiment is reflected across cities and the hinterland. Metros drop totheir year’s low index value after three stable quarters. Tier-2 cities have been on a slow slideover the last two quarters and lose significantly in the current. Tier-3 towns drop to their year’slow but do not lose as much, while rural hiring sentiments continue to be in a limbo. City (Figures in percentage) Quarter Net Increase/ Decrease 20 19 18 17Metro 88 91 89 89 -03Tier – II Cities 17 20 21 22 -03Tier – III Towns 8 10 10 9 -02Rural 1 1 1 1 NChttp://be-in-touch.com
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  • 7.2 Hiring Intent by HierarchyTrends by the hierarchy are reversed this quarter, with respondents downgrading hiring acrossthe board. Junior and Mid-level hiring suffer the most although the former stays its leadershipposition. All but the Senior level category of hierarchy hit their year-lows. Level (Figures in percentage) Quarter Net Increase/ Decrease 20 19 18 17Entry Level 47 50 49 47 -03[No Experience]Junior Level 63 67 64 66 -04[1 – 3 years Experience]Middle Level 40 44 45 43 -04[3 – 7 years Experience]Senior Level 24 25 24 23 -01[> 7 years Experience]Not Hiring 11 10 10 12 +01http://be-in-touch.com
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  • 7.3 Hiring Intent by Functional AreaWith IT and Engineering bearing the brunt of the grim sentiment, most other functional areasare spared the magnitude of drops most sectors and cities witness in general, this quarter. Thetwo worst affected functional areas slip to their 4-quarter lows, while Accounts / Finance andAdministration / HR / Office Service also achieve the same feat continuing in their lowdeceleration or stagnation mode. F (Figures in percentage) Quarter Net Increase / Decrease 20 19 18 17Sales / Marketing / 79 82 78 77Customer Service [SMC] -03IT 25 31 29 27 -06Engineering [ENG] 39 43 42 41 -04Accounts / Finance 13 15 16 16[A&F] -02Administration / HR / 12 12 14 13Office Service [AHO] -Blue Collar [BC]* 41 43 40 37 -02Other 8 10 13 15 -02Not hiring 6 4 5 7 +02*Previously included under ‘Others’http://be-in-touch.com
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  • 11. Other Trends 8.1. Employment Outlook Index – city-sector drilldown 8.2. Business Outlook Index – city-sector drilldown 8.3. Attrition trends by sector 8.4. Attrition trends by cityhttp://be-in-touch.com
  • 8.1 Employment Outlook Index – city-sector drilldown City Quarter Total Sector IT ITeS FS RMF INF M&E TEL H&PMum 20 67 10 8 11 8 9 8 7 9 19 72 12 10 9 9 10 8 7 10 18 74 13 11 8 8 12 7 9 11 Del 20 61 8 3 8 10 8 9 8 9 19 70 10 6 9 11 10 10 10 9 18 69 10 5 11 13 8 9 11 8 Blr 20 79 10 7 6 7 12 11 17 14 19 88 13 10 7 9 14 13 19 12 18 86 16 10 4 7 15 14 17 11 Kol 20 61 4 3 13 12 5 6 4 19 19 56 3 3 10 11 5 4 5 17 18 60 5 3 12 12 5 5 5 18 Chn 20 63 7 7 9 9 10 10 10 5 19 70 10 11 9 10 9 10 13 4 18 72 12 11 10 8 10 12 11 6http://be-in-touch.com
  • Pun 20 70 11 9 5 4 15 12 9 10 19 78 16 15 6 5 18 14 8 8 18 76 15 15 5 6 17 16 6 7 Hyd 20 60 7 10 6 9 9 10 6 7 19 60 9 11 5 8 10 11 4 4 18 61 10 12 4 8 9 10 5 6 Ahd 20 67 4 4 20 5 3 10 6 19 19 72 6 4 21 6 4 12 8 23 18 70 4 3 20 6 5 13 8 228.2 Business Outlook Index – city-sector drilldown City Quarter Total Sector IT ITeS FS RMF INF M&E TEL H&PMum 20 63 11 8 6 5 19 10 6 9 19 65 12 12 7 6 17 9 5 10 18 63 14 10 8 5 16 10 6 8 Del 20 47 7 3 7 11 6 7 7 9 19 51 10 3 5 13 10 6 7 10 18 52 10 4 4 14 8 8 9 9http://be-in-touch.com
  • Blr 20 74 15 7 10 8 11 9 11 8 19 80 17 11 9 7 12 9 12 8 18 81 19 10 8 5 14 10 13 9 Kol 20 68 10 3 12 10 7 10 7 17 19 69 10 4 14 10 4 10 7 20 18 70 11 4 15 9 4 13 6 19 Chn 20 75 11 14 10 5 9 12 12 12 19 82 15 16 12 4 9 15 11 11 18 81 11 19 10 5 10 15 10 12 Pun 20 79 10 21 5 6 16 15 9 7 19 84 12 24 6 5 18 17 8 7 18 85 14 22 4 4 20 17 10 9 Hyd 20 74 10 8 10 5 9 12 8 17 19 76 10 9 11 7 9 10 8 15 18 80 13 10 12 6 10 9 6 18 Ahd 20 70 6 5 17 8 3 15 4 20 19 74 8 6 18 8 2 17 3 19 18 71 5 6 18 6 3 19 4 18http://be-in-touch.com
  • 8.3 Attrition Trends – by cityThe current quarter fails to abate the increasing attrition rate in most cities. The increase ismarginally, however, as opposed to the sharper trend it saw last quarter. Delhi, Chennai andAhmedabad counter this incremental upward movement with small dips in their respectiveattrition rates.8.4 Attrition Trends – by sectorWith exceptions of appreciable dips in attrition rates in IT and ITeS, and not so appreciablereductions in case of Infrastructure and Telecom, all other sectors see attrition risingmarginally.http://be-in-touch.com
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  • 13. Insights 9.1. City-Sector Highs and Lowshttp://be-in-touch.com
  • 9.1 City-Sector Highs and LowsHaving gone through a full circle this calendar year – in term of exuberant business andemployment sentiment – and hitting year-lows across many a city and sector, it would beinteresting to understand the patters sentiments have followed across city-sector clusters.Following is a descriptive analysis of the extremes employment and business indices havereached over the past 4 quarters.The manner in which these high-low plots are to be used is quite simple: compare thedirections of movement and the magnitude of the high-low plot for each city-sector clusterbetween the employment and business index sides. If the direction of movement is similar, thecity-sector cluster has followed the same trend between hiring and business sentiment. If thedirection is reversed, the two sentiments are not in synchrony.MumbaiThe aggregate Employment index movement is downward for Mumbai compared with an upwardBusiness index movement. IT and ITeS exhibit downward movements for both Employment andBusiness sentiment for the city. Manufacturing & Engineering and Telecom have had upwardtrajectories.DelhiBoth Employment and Business indices have traversed downward in case of Delhi. Except for FinancialServices, where the downward Employment index movement is in contrast with the upward Businessindex movement, sectors have similar patterns of movement between the Employment and Businessindices.http://be-in-touch.com
  • BangaloreA very symmetrical arrangement between Employment and Business index movements has just twoexceptions in case of Bangalore – Telecom and Healthcare & Pharmaceuticals. The aggregates mirroreach other’s movements as wellKolkatahttp://be-in-touch.com
  • Kolkata’s is a mixed picture – thanks, mostly, to the upward movement its indices have had over thecurrent quarter. Except for Financial Services and Healthcare & Pharmaceuticals, all other sectors havereversed index movement patterns.ChennaiChennai displays disconnect between the two sets of city-sector cluster indices. While both aggregatesof Employment and Business indices have downward movements, ITeS and Healthcare &Pharmaceuticals are the only cases where patterns match.PuneA fairly symmetrical index movement pattern characterizes Pune, the only exceptions being Retail &FMCG and Healthcare & Pharmaceuticals. The magnitudes of the high-low plots vary drastically,however, in most city-sector clusters.http://be-in-touch.com
  • HyderabadHyderabad and Ahmedabad do not have much of a discernible pattern. Hyderabad has the aggregateson both sides following a mutually reversed pattern, while Ahmedabad’s are in sync. In both cases,almost none of the city-sector clusters on either side are matched.AhmedabadReading the box plots [white filled boxes indicate upward and black filled indicate downwardtrending]: 4-quarter high Q-20 index value 4-quarter average 4-quarter lowhttp://be-in-touch.com
  • 9. Annexure Research Methodology The Employment Outlook Survey follows a rigorous and statistically validated process as detailed below. Sample Design & Data Collection Random sampling technique was used to identify respondents for the survey. Data sources used to collect contact data were: 1. Kompass directory for small, medium and large sized companies in the private sector. To ensure continuity with the baseline measurement, the core random sample was drawn from this database. 2. NASSCOM database for IT companies 3. Companies registered with bpo.india.org in the case of ITES and 4. Financial companies registered with the Bombay Stock Exchange (BSE). Respondent Selection Target respondents for the study were Business & HR Heads as well as Senior Managers with hiring mandates. The databases offered a contact name for each company listed. Interviewers called into each of these companies and obtained the names of the appropriate individuals who were responsible for hiring decisions. Data Collection The survey instrument was then administered to the target respondents using the CATI (Computer Aided Telephonic Interview) methodology. Appropriate computer software was used for data collection and tabulation. Please refer the following section named ‘Sample Distribution’ for details on city and business size-wise breakup of the sample.http://be-in-touch.com
  • Sample DistributionCity-wise breakupSectors / City Mumbai Delhi Bangalore Kolkata Chennai Pune Hyderabad Ahmedabad TotalManufacturing &Engineering [M&E] 6 8 9 9 10 10 7 8 67Retail & FMCG[R&F] 13 17 10 10 10 9 8 8 85Financial Services[FS] 10 8 11 7 12 12 7 8 75IT 12 10 12 8 9 10 10 8 79ITeS 9 12 11 9 10 10 9 8 78Infrastructure [INF] 8 10 10 8 9 11 9 9 74Telecom [TEL] 9 10 10 12 9 12 9 10 81Healthcare & Pharma[H&P] 12 9 11 11 12 8 9 9 81Total 79 84 84 74 81 82 68 68 620Business Size Breakup Small Medium Large [Up to 249 employees] [250 – 999 employees] [1,000 or more employees]Mumbai 19 50 10Delhi 13 60 11Bangalore 19 48 17Kolkata 14 51 9Chennai 20 44 17Pune 14 52 16Hyderabad 16 40 12Ahmedabad 12 42 14http://be-in-touch.com
  • 10.3. Reasons for Attrition – the employer perspectiveBy Cityhttp://be-in-touch.com
  • By Sectorhttp://be-in-touch.com
  • Know more, Follow us and Like us:http://twitter.com/be_in_touchhttp://facebook.com/intouchanalyticshttp://linkedin.com/companies/305009http://be-in-touch.com