Most Indian companies have decided not to resort to any more job cuts even as they have put a cap on fresh hiring and staff incentives with a curb on outstation travel for executives, says a survey released.
Most Indian companies have decided not to resort to any more job cuts even as they have put a cap on fresh hiring and staff incentives with a curb on outstation travel for executives, says a survey released.
More than 75 percent of the respondents in the survey by PricewaterhouseCoopers (PwC) said they were reviewing their recruitment strategy to manage costs. A majority of them had also imposed a freeze on fresh hiring.
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The information technology and outsourcing sectors, known for aggressive hiring in the past, have become more conservative with 84 percent stating that there will be no more recruitments.
"Other sectors that have put a freeze are fast-moving consumer goods (70 percent), manufacturing (63 percent), and banking, financial services and insurance (57 percent)," the consultancy said quoting the survey.
Also, smaller firms with employee strength of less than 100 are focusing on selective hiring for critical positions only. What has also come as a relief was that 84 percent respondents had shied away from employee layoffs as a way of controlling costs.
Moreover, over one-third of Indian companies said they have frozen salary increments for the coming year and were reducing bonus or variable pays.
"Most companies in India are gearing up for tough times but are avoiding knee-jerk reactions. Employers are uncertain about the extent, duration and depth of the economic slowdown and the timing of a recovery," PwC India's Sankar Ramamurthy said.
"Therefore, they are being cautious about spending and making investments, and this caution is reflected in the way they plan to manage human resources," Ramamurthy added.
The banking, financial services and insurance sector is among the worst hit, with more than half of the respondents saying they were focusing on freezing recruitment.
A smaller number of companies - about 21 percent - in the financial services sector have also admitted to considering layoffs, though 43 percent said they have opted for selective hiring.
Retail is another sector that has been badly hit by the slowdown, with expansion plans being put on hold and respondents admitting they were not averse to layoffs if other actions proved insufficient.
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