Just as India went into a nationwide lockdown in late March to prevent the spread of novel coronavirus, a year-old recruitment startup Skillr, which helps companies hire talent from smaller towns and train their workforce, had to let go of 60% of its staff.
Once these employees started to look for a new job and couldn’t find any lead, Skillr realized the depth of the information gap in the market. The company said it wasn’t that no one was hiring, but there was a lack of reliable information.
“For the people who lost their job, there was no accurate information available that could help them understand who was really hiring,” Ankit Durga, co-founder of Skillr, told KrASIA. “So we started crowdsourcing information about who was hiring and who was firing.”
Early in April, Skillr started to create a database to track all the companies that were looking to hire as well as those who had to lay off people to conserve cash.
The New-Delhi based startup isn’t the only one doing that. A Singapore-based recruitment platform Big.Jobs started a platform called ‘CareerVsCovid19‘ to connect people who lost their job due to the healthcare pandemic with the companies that are still hiring.
Similarly, Silver Lining is another tech job platform for those who have been laid off. Although predominantly focused on the US market, the Seattle-based platform is starting to see “not an insignificant” number of Indians signing up on its website, its founder, Chris Brownridge, told KrASIA.
Meanwhile, IT services giant Accenture has built a global platform called ‘People + Work Connect’ to bring together companies that are laying off or furloughing their employees with companies that are in urgent need to fill similar roles.
Over the last two months, a flurry of high profile Indian startups has announced massive layoffs. The list includes SoftBank-backed hospitality chain Oyo, cab-hailing giants Uber and Ola, food tech unicorns Swiggy and Zomato, fitness and gym startup Curefit, social e-commerce platform Meesho, online movie-booking company BookMyShow, online travel agent MakeMyTrip, and regional social media platform Sharechat.
According to a Mumbai-based business information company, Centre for Monitoring Indian Economy, over 100 million people have lost their jobs since the lockdown started on March 25. Of the total, 20-25% of job losses were in the organized sector, as per the industry estimates.
While job cuts are taking place across the sector, the most severely affected ones are tourism, real estate, consumer services, and logistics, said Himanshu Geed, co-founder, Big.Jobs. The least affected sectors, he added, include fast-moving consumer goods (FMCG), consulting, education, and energy.
What makes the matters worse is the fact that not many companies are handling layoffs well. While a lot of the companies are giving severance packages and healthcare insurance, among other benefits, there are hardly any firms that are looking at re-employment services.
“I don’t think many companies can offer re-employment services since cash conservation is so important right now for them. And there are just too many people looking for jobs right now,” Durga said.
The silver lining in all this is there are companies that are still hiring. These are mainly tech companies, in sectors such as health tech, edtech, IT, gaming, e-commerce, e-grocery, productivity software, and financial services.
Hiring in times of crisis
Interestingly, the database collated by Skillr and CareerVsCovid19 shows there are more firms that are hiring than those that are firing.
For instance, CareerVsCovid19’s analysis of 921 of the 1400 companies it has listed on its platform shows 43% of them are hiring, 32% have decided to layoff people, while the rest have stalled hiring. Similarly, Skillr’s Durga said, only one-third of the total 3500 firms that it is tracking are laying off their employees. The platform has listed over 2,000 companies that are hiring.
Edtech platforms such as Unacademy, Upgrad, and Testbook, e-grocery companies Grofers and Bigbasket, online real estate startup NoBroker, gaming firm Dream11, on-demand concierge service Dunzo, fintech startups like RazorPay and Setu, e-commerce platforms including Amazon, Flipkart, and Dealshare, are among those that are reportedly hiring.
It is to be noted that a lot of the companies that are looking for candidates, are not actually hiring. According to Durga, they are creating a robust pipeline of candidates for the time when the lockdown lifts and the situation improves. Companies that are actually hiring are paying 15-20% lower salaries to the new employees as compared to what they were earning previously. Durga said people are choosing to take these up as everyone’s looking for economic security right now.
“Till about three months ago, the high-quality talent was rare in India, which gave candidates a lot of bargaining power,” explained Durga. “Overnight, India has become an employers’ market.”
A time for course correction
According to CareerVsCovid19, over 330 companies have laid off their employees due to the novel coronavirus induced slowdown. More than half of these, about 183 companies are startups, of which 70% are VC-backed.
This healthcare crisis has forced many high valued startups to make a course correction from their earlier target of chasing hyper-growth, which meant exponentially increasing their team size.
Geed said the data clearly suggests that growth-stage startups (Series B, C, and D) are most affected by layoffs in comparison to other startups. “Many companies that over-staffed their teams prior to the crisis in anticipation of growth are now forced to put new projects on indefinite hold and cut-down their employee headcount,” he said.
Skillr’s Durga believes the market is primarily led by investors right now. “All the shots are being called by investors, whose only focus is to conserve cash. They want startups to brace for as long term as they can. So, a lot of these [firing] decisions are actually led by investors,” he said.
Brownridge of Silver Lining believes that most companies are reassessing their growth approach. “They are looking at things and wondering how they can make out of this because there is a major uncertainty here. No one knows how long this crisis will last. The companies understand that they might need to last up to two years [like this],” he said.
Brownridge, who set up Silver Lining last November just after the WeWork collapse sent shockwaves through Silicon Valley all the way to India, said he started seeing course-correction happen even before the COVID-19 crisis hit the world.
According to him, there was a movement in the US that steered founders away from the approach of raise-all-the-money-you-can, unless and until there is a robust revenue model. “We were growing as a platform before the crisis occurred because of the layoffs in Uber, WeWork, and Oyo,” he said.
In India, even as the signs of course correction started appearing in the startup ecosystem late last year, the major layoffs didn’t begin till the healthcare crisis descended in March. And that is when companies like Skillr and Big.Jobs rolled out initiatives to bridge the gap between firing and hiring in the third largest startup ecosystem.
The matchmakers
Geed said he started CareerVsCovid19 as a simple crowdsourced exercise at Big.Jobs to track how jobs are getting impacted during this crisis.
“Very quickly this grew bigger than us and we started getting support from independent volunteers who are contributing to the initiative,” he explained. “The idea behind CareerVsCovid19 is to gradually transform it to be an action-center to manage the human resources crisis during this pandemic.”
Currently, the platform is helping 2,300 laid-off employees look for fresh opportunities. Skillr, on its part, has 3,000 candidates available for hire.
“We’re projecting the program to scale up to over 100,000 jobseekers and over 1,000 hiring companies by the end of this year,” said Geed. “To manage this at scale, we’re currently working on powering CareerVsCovid19 by integrating an AI-powered matching engine and applicant tracking system we’ve developed at Big.Jobs.”
Meanwhile, Skillr has recently launched a bot, which can just tell users which companies are hiring over WhatsApp. As more people sign up on its platform, it is hiring “a large number of” recruiters to ease the process of connecting job seekers with job providers.
Taking care of mental health is another aspect that these platforms are trying to help people with. A lot of people start feeling anxious and go into depression due to sudden job loss.
“Losing a job for anybody is probably the most challenging thing to encounter in life. It is even more amplified because of the crisis we are in right now,” said Brownridge of Silver Lining. “Our goal is to put resources in place to help people through this difficult time.”
“We are looking for volunteers, people who have coaching expertise—to give back their expertise pro bono to help people, and mental health is one piece of it,” he said.
While CareerVsCovid19 runs a separate program for mental support, Skillr offers resources on mental health, but Durga doesn’t think that’s enough as the situation demands help from experts.
“We are hearing horror stories about how people are getting fired and employers, instead of being compassionate about it, are actually finding excuses to fire people in small or large companies,” Durga said. “It is really important to extend whatever support you can to your team because everyone is fighting their own battles.”
The outlook
Geed believes that the job crisis is far from over in India.
“For white-collar jobs, there is a general feeling that the crisis has only begun—currently concentrated largely on a few sectors and VC-backed companies,” said Geed. In the next few months, he expects more companies to reel under the financial pressure and go leaner by resorting to layoffs.
“In the next three to four quarters, we’ll potentially see about a million layoffs in white-collar segment mostly driven by large traditional companies,” Geed said. “There’s a general feeling that the worst is yet to come.”
However, all hope is not lost.
Hiring is definitely happening, but it’s very concentrated, primarily on tech and healthcare, Durga said. He expects the logistics space to pick up this month. “They’ve gone through a series of layoffs and with restrictions easing out now, by June end, we will start seeing resurgent hiring in logistics,” he said.
He believes consumer-facing companies will recover after logistics, followed by enterprise-focused companies, and that the last ones to recover would be hospitality and travel.
Brownridge said with companies around the world embracing the culture of remote work, new job opportunities would open up. Furthermore, as many investors continue to back startups that are working on solutions relevant to the post coronavirus world, it will help create some job opportunities.
“VCs are investing in areas that are likely to come out stronger. That will be a driver for some job growth,” Brownridge said.