Once 5G becomes a reality it will create jobs in the telecom sector: Paul Dupuis, MD & CEO, Randstad India
There is a reinvention happening with telecom right now; I would not call it a crisis but an evolution in this sector.
According to data compiled by brokerage firm CLSA, FY18 turned out to be the slowest in terms of hiring in the last four fiscal years, while FY16 saw the best with growth of 4.2%. It is widely estimated by workforce analysts that the job market may see a recovery at the end of 2018, but will be less than FY16. It is also estimated that the job market in FY19 may see a growth of 4.1 %.
A recent report has suggested that telecom sector might have to let go of 60,000+ employees by the end of the financial year. BW people speaks to Paul Dupuis, MD & CEO Randstad India on what this contraction means to the Indian economy, which sectors may get affected and his vision on the future of jobs by 2020.
Edited Excerpts from his interview.
Q. As per a recent report, about 65,000 jobs are going to be slashed in the telecom sector at the end of this financial year. So what kind of crisis will this lead the Indian economy into?
I think we need to be very careful, while using the term crisis. Let us not be presumptuous about anything here. When you think about the current situation, this has been in the making for about 10 years. We saw it coming. In any industry, competitive markets thrive when there are 3 - 4 players. And even when there is one it is very dangerous. It was the same thing when Indigo disrupted the civil aviation market too. There is a reinvention happening in the telecom sector too. I would not call it a crisis, rather an evolution.
Q. Which level of organisational structure you think these redundancies will have an impact in the long run?
I don’t think this will have too much of an effect in the long term. The majority of redundancies will happen where there are going to be job overlaps. For example Idea and Vodafone have merged. Hypothetically speaking, now there is no need for them to have two stores in the same location. So basically, the customer facing roles will be the first ones to be effected. The low-level jobs will get hit first. Most likely functions to be affected will be accounts, sales, front level marketing etc. So that 65,000 number is mostly at the bottom of the Pyramid. We expect the same trend to continue through 2019. Once 5G becomes a reality, we should see growth returning to the sector.
Q. What will be the future of these employees who will face the repercussions of this massive job slash?
These 65,000 jobs that we talk about, we have to be very careful with this headline. These are not carefully crafted niche roles that will be impacted. These roles that would get affected are actually quite transferrable and generic roles. So a sales person in telecom can be a sales person in some other area as well.
Q. Which other sectors are going to follow the trail after telecom sector to lead to a job crisis?
In terms of decline, we are seeing a few things. I think the Banking and Financial Services space is one where there is scope for consolidation, though one could make the argument that job cuts might not become a reality given that India’s financially excluded population remains relatively large. But we do not see the telecom story being replicated elsewhere.
Q. As a staffing company can you foresee the future a little bit for 2020? Which companies do you think are going to see maximum number of job creation?
If you look at India at the moment, it is a country that is growing. In terms of the economy and the workforce. From that perspective, infrastructure is most certainly going to be one of the largest job creators. Energy is another one that has excellent growth potential. So if I were to advise young people in India on career prospects I would definitely recommend energy and infrastructure as ones to pursue. Additionally, let’s not underestimate the immense potential of retail in India. Big box brands like IKEA have finally decided that now is the time to do business here. Retail adds meaningfully to the hiring numbers and has significant network effects too.