India's job market shifts: 17.5% decrease in demand for blue collar workers

The demand for blue collar jobs or frontline workers has declined by 17.5 per cent in FY23, according to a report by frontline workforce management platform BetterPlace. About 6.6 million jobs were created in the last fiscal year as compared to eight million in FY22.

The report cited that the decline happened due to cautious hiring by companies amid macroeconomic headwinds. It also said that the decline comes after companies went on a hiring spree in FY22 when businesses reopened after the COVID-19 pandemic.

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These frontline jobs include customer-facing roles such as call centre workers, delivery personnel, marketing executives, sales and business development executives and housekeeping staff, among others.

“The macroeconomic headwinds have forced enterprises in India and Southeast Asia to rethink their hiring practices, which resulted in a decline in demand for frontline workers this year,” said Pravin Agarwala, Co-founder and Group CEO at BetterPlace.

The report stated that they are witnessing ‘The Great Variabilisation Trend’. Enterprises in a bid to cut costs are moving away from fixed employees to task-based employees. This has led to an increase in gigification because enterprises are now able to factor in variable demand and manage operational costs.

Hence, the sectors where gig wasn’t very popular are now becoming a norm.

One of the primary reasons behind the decrease in frontline jobs was driven by the e-commerce sector. The dominance of the e-commerce sector, says the report, has been replaced by the logistics and mobility and financial management and IT sectors, which collectively contribute to more than 61 per cent of the new jobs created.

One of the good signs in the report showed that women's participation in the frontline sector has increased by 100 per cent since last year.

“This is largely because of the changing perceptions around working women,” says the report.

But, on the other hand, women's force still remains at six per cent of the entire workforce.

The report showed key trends that with an increase in the country’s headline inflation, the average monthly salary of frontline workers has slipped by 4.5 per cent to Rs 21,700 in FY23 from Rs 22,800 in FY22.

Of this, the average salary for women frontline workers was 20.5 per cent lower than the industry average salary.

The average salary for women frontline workers in logistics & mobility, and manufacturing was 20 per cent and 36 per cent, respectively, higher than the industry average.

With the lower intent to hire, enterprises are now training their existing workers to take on larger roles. The time spent on learning has increased by more than 165 per cent between April 2022 and March 2023, the report showed.

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