JOIN USPandemic Impact: Coronavirus may swallow one in 10 jobs in India
An estimated six crore Indians out of 60 crore who go to work (or one in 10) are at the risk of losing their jobs before autumn breaks in India, with businesses under the lockdown facing severe challenges to resume.
The informal sector — the backbone of the country’s economy which accounts for over 88% of total employment — will witness a majority of job losses.
The formal sector too will lose quite a number of employees but those hired by the government — an estimated one crore — will escape unscathed, a DH analysis of data gathered from HR firms shows.
According to data from the Indian Staffing Federation (ISF), about 60 crore of India’s 130 crore people go to work. Of this, about 53 crore are employed in the informal sector and seven crore in the formal sector. Of the seven crore, one crore are government employees and their jobs are completely safe.
“As the whole country is locked down to control the pandemic, various sectors of the economy are facing disruption in their business. This is expected to result in job loss in many sectors and an average 10% of workers could face job loss across both formal and informal sectors in the next 3-6 months,” ISF president Lohit Bhatia said.
Segments within the formal sector such as aviation, travel, tourism and hospitality are completely shut down and there is no possibility of airlines starting operations until June. Many hotels which have multiple units may close down some and retain only one or two, which will lead to a decrease in manpower requirement.
Malls and cinema houses may not open immediately and gig workers like taxi and truck drivers, dhabas and highway mechanics are finding it difficult to resume operations. “All this will lead to loss of jobs”, Bhatia explained.
Better off
Those who don’t stare at job losses are the employees in banking, e-commerce, IT/ITeS and telecom sectors. During the lockdown, the demand for broadband service has zoomed, leading to job creation in the telecom sector.
Telecom service providers are waiting for the lockdown to lift so that they can open shops. E-commerce companies are also going to recruit in big numbers. Banks want to hire more. Top-tier IT companies such as TCS, Infosys and Wipro have said they will not cut jobs.
Informal sector workers will be rendered more vulnerable in the absence of any social security cover such as PF, gratuity or insurance.