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Slowdown hits headhunters

Views 0 Views    Comments 0 Comments    Share Share    Posted 06-05-2009  
HR recruitment firms in India have taken a significant hit in volumes in financial year 2009 (FY09) due to the economic slowdown and the consequent hiring freeze by clients. Companies said that the slump has been marked in the last 6-8 months, adding that there is also no indication of a turnaround for them, at least in the next two quarters.
“Volumes for the industry came down by over 25 per cent for the year. The downward trend was seen mainly in the last six months of the financial year,’’ Ashok Reddy, MD of Teamlease told Financial Chronicle. Teamlease saw flat growth to touch revenues of Rs 750 crore in 2008-09.
Reddy expects larger impact on the firm’s top line this year because he sees business coming down further in next few months with no sign from clients wanting to hire people.
According to Shiv Agarwal, CEO of ABC Consultants, the sectors that have been affected the most in terms of decreased hiring numbers are outsourcing, technology, real estate and financial services. Recruitment firms have especially been hit by the slump in the IT/ITeS sector since it was the largest hirer in last decade, taking in between 3-4 lakh each year (including campus recruits).
Said Agarwal: “In the present financial year, we are not expecting any growth at all at least in the first 6 months. However, we hope the market will recover in the second half.’’
Several companies —both large and small — are pruning their staff to tackle the downturn. For instance, Teamlease has seen its headcount including the roster of temporary staff fall to 64,000 people from 82,000 people in April 2008. Openings of permanent positions have fallen to 800 from 1,500-2,000 earlier. Smaller companies, which employed about 50-60 people, have decreased their numbers to 10-15 now.
India’s permanent recruitment industry is worth Rs 1,250 crore. It has over 10,000 companies, mostly small and unorganised with two or three clients. Apart from this, the country has a strong temporary staffing industry worth over Rs 2,000 crore with a few organised players including Teamlease, Adecco, Mafoi, Manpower and Kelly Services.

Source:
http://www.mydigitalfc.com/jobs/slowdown-hits-headhunters-367
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