The colour pink may bring a smile to most faces but getting a pink slip at your workplace, as everyone knows, is a devastating and nightmarish exprience. A man is defined by the work he does, as they say. But if you are going to your boss with a high-tech presentation on your new project which is your dream assignment and suddenly, you get an urgent HR call to report immediately, the palpitations in your heart are understandable. Being handed a pink slip and being told that your services are "no longer needed" without any further explanations, is like a bolt from the blue. Regrettably, this is happening in coporate India, which is struggling with a slew of problems like slower demand, high interest rates, little governmnet help and policy inaction. But the worst is yet to come as the layoffs are likely to grow in the days to come.
Experts opine that if things gon on like this, job losses across the country would touch 500,000 in 2013-14, similar to the levels in 2008-09. India has lost 50 lakh jobs during 2005-2010 as per the Planning Commission while only 27.6 lakh jobs were added. A Naukri.com survey reveals a muted hiring sentiment for the rest of 2013 compared to that during the beginning of the year, with only 43 % recruiters predicting new job creation. The hiring confidence can't overlook the bad shape of the economy and hence reflects the slowdown. An estimated 45 lakh enter the Indian job market every year - 750,000 engineers, 500,000 MBAs and at least 30 lakh other graduates.
Experts blame the current bleak scenario on high interest rates, subdued industrial output and falling domestic consumption which has slowed down the economy, resulting in lower credit offtake. According to RBI, scheduled commercial banks' overall credit grew at a slower pace during FY 2012, at 17 % year-on-year as compared to 21.5 % during FY 2011.
Several employees from the lucrative banking and financial services industry are staring at financial instability as the industry cuts jobs. In April 2012, HSBC fired 350 employees in its Pune office and another 200 in Hyderabad. The bad news continued into 2013 with other banks following suit. UBS, for instance, has begun slashing staff and has decided to surrender its banking licence to RBI, which it had held since 2008, as part of the group strategy. Similarly, the Royal Bank of Scotland has decided to shut some branches and trim the workforce by 25 %. While severance packages vary, the industry people claim that it is usually a month's salary for every year of service.