India is limping back to normalcy. Can we say the same about our finances?

Majority of professionals now have the freedom of stepping out of their homes and going to their workplaces, malls and restaurants. It’s a welcome relief for businesses even though they have to invest in processes and gear that enable social distancing.

But for me, and as inevitably for many others, the first question was if consumers would feel safe and comfortable heading out at all. And then, would discretionary spending pick up? Especially as reports about layoffs and salary cuts across sectors add to the uncertainty. I popped this question in an interview to Pushpa Bector, the executive director of DLF Shopping Malls, who said consumers may trade down on their indulgences for a while, but they would not compromise on their lifestyle.

How true does that ring for you? And are there any visible signs of individuals and households moderating their expenses on non-essentials?

LinkedIn’s biweekly Workforce Confidence Index gives us some insights. The index - a survey of 2,903 professionals in India during May 4-31 - gauges sentiments about one’s ability to get or hold on to a job right now, improve their financial situation in the next six months and progress in their career over the next year.

About two in five employees in healthcare (39%) and education (44%) expect a decline in their earned income in the next six months, the survey found. This sentiment is shared by more than 30% of employees in software and IT and 29% in corporate services.

That’s impacting spending plans: At least a third of all respondents from healthcare, corporate services, IT, manufacturing and finance industries anticipate a decline in their expenses during this period. Many also expect their number of investments in stocks, mutual funds and such, to decline in the near term (see chart below).

With unemployment at unprecedented levels globally, personal finance will take a hit, says Adhil Shetty, CEO, BankBazaar.com. In its Consumer Confidence Survey for May, the Reserve Bank of India stated that consumer perception about the general economic situation, employment scenario and household income dipped further.

Smart money management is, therefore, critical to survive through this period. “Liquidity, insurance, loans and investments are the four pillars of your personal finance and you need to pay attention to all four,” Shetty says.

Overall, the survey found that individual confidence levels of professionals remained largely consistent from two weeks prior, though workers’  financial outlook is still the biggest worry for many. .

Employees working in large enterprise companies (10,000+ workers) were found to have lower levels of individual confidence compared to their peers in mid-market (201-9,999 workers) and small businesses (1-200 workers). In terms of optimism about their company’s outlook, the trend reversed.

We piloted a Confidence in Employer Index - the net share of employees who believe their company will be better off six months from now. For enterprise workers, the index had a score of +24 — those workers were relatively more confident about their employer’s ability to bounce back stronger than those in mid-market and small companies, with CIE scores of +15 and +16 respectively.

According to HR expert Prabir Jha, large firms perceptually face a lesser volatility risk on the jobs front. Deeper pockets are also more likely to survive a longer lockdown. But while smaller firms do have the maximum risk of going belly up, no company is immune from the economic implications of the pandemic.

Big companies will use the opportunity to redraw their organisational design, refresh talent definitions and re-examine staff strengths, he says. Involuntary exits may get camouflaged at big companies due to their workforce size. Smaller firms should hang in there and use this hiatus to explore new technology-intensive ways of working.

What is the best financial advice you have received in the recent past? How can small businesses weather this storm? Share your comments with #WorkforceConfidenceIndex.

Workforce Confidence Index Methodology

LinkedIn’s Workforce Confidence Index is based on a quantitative online survey that is distributed to members via email every two weeks. Roughly 1,000+ India-based members respond each wave. Members are randomly sampled and must be opted into research to participate. Students, stay-at-home partners & retirees are excluded from analysis so we’re able to get an accurate representation of those currently active in the workforce. We analyse data in aggregate and will always respect member privacy.

Data is weighted by engagement level, to ensure fair representation of various activity levels on the platform. The results represent the world as seen through the lens of LinkedIn’s membership; variances between LinkedIn’s membership & overall market population are not accounted for. Confidence index scores are calculated by assigning each respondent a score (-100, -50, 0, 50, 100) based on how much they agree or disagree with each of three statements, and then finding the composite average score across all statements. Scores are averaged across two waves of data collection to ensure an accurate trend reading. The three statements are: [Job Security] I feel confident about my ability to get or hold onto a job right now; [Finances] I feel confident about my ability to improve my financial situation in the next 6 months; [Career] I feel confident about my ability to progress in my career in the next year.

Neil Basu and Cynthia Yee from LinkedIn Market Research contributed to this article.