Q1 2024, India Market Update

Looking back on the initial quarter of 2024, it's evident that the Indian economy is moving in a positive direction. Forecasts indicate a strong growth rate of 6.8% for the fiscal year 2024-2025, surpassing many other emerging markets within the G20 group.

While the pace of job creation may have been modest in the early months of Q1, there has been a noticeable uptick in activity as we progressed into mid-February. March, in particular, has emerged as a pivotal month, witnessing significant movement within the job market. This surge in activity reflects a shift in sentiment, with businesses increasingly expressing confidence and readiness to hire.

In the commerce sector, the manufacturing industry stands out as a key driver of economic growth, contributing a substantial 17% to India's GDP. Forecasts suggest that the expansion of manufacturing facilities is poised to generate a 2% increase in employment within the sector in 2024, indicating a significant rise in job opportunities. The growth of the Electric Vehicle (EV) market will further enhance the manufacturing sector's share. India's position as a manufacturing hub and its favorable business environment are crucial factors driving this growth.

Bloomberg highlights India's expanding consumer class and economic growth, projecting the nation to become one of the world's largest travel markets.

India continues to attract new Global Capability Centers (GCCs) and majority of the current ones continue to expand. GCCs are evolving to be Centers of Excellence (COEs) and attracting some senior level global positions that play a strategic role. Lot of Global C&B roles being placed in India within the shared services environment. A number of our clients are also looking to relocate their existing C&B roles to India so we are observing a big bump in Compensation and Talent Acquisition roles at this time. 

Overall, industry sentiment remains positive, with recent salary survey reports indicating significant salary hikes in sectors such as e-commerce, FMCG, pharmaceuticals, chemicals, and automobiles.

The increasing prevalence of remote work, contract roles, and gig opportunities is reshaping the business environment for the year. India's economic trajectory shows significant growth potential, with the services sector expected to aid in achieving the revised 7% economic growth target for FY24.

Despite global challenges, India's growth outlook remains resilient, with a projected GDP growth of 6.2% in 2024. However, the talent acquisition landscape is evolving rapidly, necessitating organizations to adapt to changing candidate expectations and technological advancements. We are also observing that the interview processes even at mid-level roles are being extended. 

In summary, the job market in India for 2024 presents both challenges and opportunities, shaped by global and national economic factors. Organizations must adapt to these dynamics to contribute to India's economic expansion and job market momentum.

Looking ahead to the second quarter, the momentum appears set to continue, with prospects for further growth in the job market looking promising. From an HR standpoint, the evolving landscape of 2024 indicates a continued need to balance employee well-being with productivity demands.