India has its own edge in job creation: Wilkinson

The € 12.4 billion (in 2009) Ranstad’s services range from regular temporary staffing and permanent placement to in house, professionals, search and selection, and HR solutions. Since acquiring Vedior in 2008, the Randstad Group is the second largest HR services provider in the world. |

In India it operates as Ma Foi Randstad. Randstad has approximately 25,500 employees working from over 4,100 branches and in-house locations in 44 countries around the world, at the end of 2009.
Randstad global director Brian Wilkinson was appointed to the Randstad executive board following the merger with Vedior, and is responsible for the combined businesses in the UK, Australia and Pacific, the Middle East and parts of Asia. Wilkinson, who recently visited Bangalore spoke to Deccan Herald’s Dilip Maitra on a variety of issues relevant to the job market scenario in India and Asia Pacific. Here is an excerpt of the interview.

DH: How long have you been tracking the Indian employment scenario?

Wilkinson: I have been responsible for India business since 2004 when we tied up with Ma Foi. I am also responsible for Australia, New Zealand, China and a lot of other countries. We introduced new management structure for South East Asia, China. I frequently travel to India as the country is important in our portfolio.

DH: As the world was recovering from the recession, new crisis brewed in Europe. What is your perspective on the employment scene post recession?

Wilkinson:  Broadly we see positive trends gaining momentum. In 2006 itself we had surveyed a lot and predicted a decline in the manufacturing industry. And, we presented how we will react in downturn.

We are in recovery phase even in USA. Not only in America, Germany and France are strongest in global line.

India is soon going to be the next leader. Here HR, legal, web-based solutions, advertising, marketing, creative industry are booming again and IT is very strong.

In India hospitality, healthcare, real estate & construction are the areas we see strong recruitment prospects. In the rest of the world, manufacturing is the biggest but not attractive for the Ranstad. Flexi-staffing Mid and higher job grades, search & selection is a big business in India for us. In fact, our India activity is even bigger than China. Here we have 350 employees in selection, 50 in the search business against only 100 in china. This is because India is a more matured market thanks to the thriving private sector.

DH: It is surely because of private companies here. Moving forward, any areas you see growth?

Wilikinson: Real estate, Hospitality, IT & ITeS, Construction. Identifying those clients who are interested in value adds and flexi-staffing are what we are looking at. There is a difference in India and China vis-à-vis in US, UK. On Saturdays, the US and UK need help. There are large signs that flexi-staffing will happen in India (It is in embryo state). It has started in India in retail sector. Also it is picking up.

DH: Do you see any difference in compensation acceptance in India and in western countries?

Wilkinson: In more developed markets, employees are interested about what they can learn. For instance, they join large blue chip companies even at salaries much lower than their regular payroll standards, and then move on after two/three years of experience. Whereas in India and China, people concentrate more on salaries they are going to start with.

DH: India’s IT Industry saw huge recruitment this year. As demand for IT workers is going up the employee cost is also escalating. Is India becoming uncompetitive compared to other countries?

Wilkinson: It is true that the wage cost is going up in India but there is a great deal of interest in India as the costs are still low compared to USA and European countries. That is why opportunities here are a lot more.

DH: Will India lose its edge to countries like Phillipines, Indonesia, Sri Lanka, China etc?

Wilkinson: I do not think so. Ease of doing business in India cannot be found in other countries. India is a comfortable place to work in as its legal framework is strong and the law-of-the-land prevails in most part of the country. So India has the competitive advantage.

DH: Aren’t infrastructure and bureaucracy road blocks for companies like you?

Wilkinson: The entire board is here this week which means how important we consider this market to be. There is huge amount of wealth in this country. We did not want to do business in Russia because there are not as many positives as I mentioned about India. We did not get into negative growth at all in India in spite of recession.

Actually in 2010, we did very well in recruitment and flexi-staffing businesses. Flexi-staffing and other businesses were reduced by about 30 per cent in Europe during downturn. But India had the least amount of losses. Also India was one of the first markets to open up after recession.

DH: Isn’t there a fear in people’s minds that Eurozone might collapse under as many member countries are in deep trouble due to huge governmental deficits?

Wilkinson: There has been a strong diktat from economists and politicians that Euro has conferred considerable benefits to its members. We have a strong currency in comparison to dollar. What is more worrisome from the recruitment point of view is protectionism that is closing immigration, like in the UK. This is more risky than currency shortage as it leads to lack of talent.

Ranstad did a study recently which says that there will be a shortfall of 32 million jobs by 2015. This is scary because in reality it will be more. This is also due to low birth rate and ageing population in Europe. This is completely opposite to what our businesses need. So the obvious alternative is to import workers. Nearly 40 per cent of our European clients have vacancies because they can’t find talent. Due to new immigration rules in the UK 15 per cent of expats from UK are coming back. But, I think, the final Implementation will be diluted to keep coalition in place in the UK. It is also not right to disallow employees to be transferred from one country to the other within the same company.

DH: Will outsourcing of HR activities be big for India?

Wilkinson: It is a substantial part of US market. Managed services or recruitment services or outsourcing as you may call it. Cost efficiency, process improvement and quality manpower will be the result if this work is outsourced.

The biggest example is investment banks who were the first to do it. Ma Foi Ranstad’s biggest clients in India are the investment banks. Ma Foi has people onsite carrying out HR activities on behalf of these banks. Job referral and employee branding are important breakthroughs which are happening.