Is Winter really coming? What to expect for hiring in India for the rest of 2022.

What next in 2022? The question on all minds as the world sharply reverses from the pandemic driven disruption.

It’s mid 2022 and we’re looking at what seems to be a Global Reset. So how does the rest of the year look for the talent market? Dark clouds ahead, with a silver lining!?

The global macroeconomic environment has not only peaked but leaning toward recession. Inflation is at record highs across countries. Interest rates are being hiked, investment is slowing and consumption following.

The pandemic and consequent lock-downs brought the ‘digital’ world to the front and center. Startups ramped hiring to unprecedented levels, companies accelerated 5-year digital transformation plans into 6 months, the ‘metaverse’ was born!?

It is only logical that as the world returns to a pre-pandemic reality, the reversal will be as drastic – an inverted V?

Globally and in India – the startup layoff cycle has commenced, driven by a need to ‘extend runways’ as easy funding dries up. Per some estimates, Indian startups have laid off more than 5600 people in the last few months.

This will most likely pick up pace!

The Indian IT sector is also likely to face stronger headwinds with the US dipping towards recession and Europe disrupted by the Russia-Ukraine war. JP Morgan’s recent downgrade of the Indian IT sector drove a 5% crash in stock prices.

So where is the silver lining?

Digging deeper, the Indian startup universe looks more like a ‘rotation’ of funding interest rather than an overall crash. Segments that boomed during the pandemic (EdTech, for example) are clearly seeing a scale back, but fund flows and hiring are moving towards Blockchain, Gaming, D2C. ?‘Path to profitability’ companies will likely be the clear winners!

In IT Services, a hidden trend is the strong investment tilt expected towards Global Capability Centers (GCC's). The sub-sector currently employs ~1.5mn people with estimates expecting this number to double over the next 3 years, adding 500 new companies from ~1500 currently.

So, while ‘Winter is coming’ might be the theme for the next six months or more globally, one can expect the situation to remain slightly warmer in India! (No pun intended on the recent heat wave!).

Indusion Consulting

Photo by Ma?va Vigier on Unsplash