The pandemic may have played havoc with employment in the organised and unorganised sectors, but India’s new age edtech, fintech, ecommerce and logistics defied this trend and created thousands of new jobs across functions like analytics, sales, strategy, finance, marketing, engineering, product and design.
Amidst the devastation – medical, economic and professional – that the Covid-19 pandemic has wrought, with its accompanying loss of jobs and livelihoods across vast swathes of Indian society, there is one segment of the economy that has prospered: The IT-enabled start-up eco-system.
For these companies, the inability of people to step out of their homes has come as a lifeline. Over the last 15 months, work from home (WFH) has become a popular and much discussed phenomenon. Reams have been written about the pros and cons of working remotely.
But alongside WFH, things like shop from home, learn from home, transact from home, bank from home, etc., have also gained traction, although these developments have received much less attention than the concept of the remote workplace.
But these new age ways of doing business is now shoring up India’s employment numbers as companies in in edtech, fintech, ecommerce and logistics like Byju's, Unacademy, Delhivery, Udaan, Zomato, Urban Company, Bharatpe and Cred, among others, added thousands of new jobs even as the Centre for Monitoring Indian Economy (CMIE) reported massive job losses both in the organised and unorganised sectors.
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A combination of factors, including the rising penetration of smartphones, which is estimated to cross 750 million or 20 per cent of the global total this year, the world’s second highest number of internet users, strict social distancing norms, reliable broadband connections, several localised lockdowns and rising felicity with online financial transactions are boosting these companies, which in turn is driving higher employment generation in this segment of the economy.
During the course of the pandemic, Indian unicorns and start-ups likely to achieve this status soon hired an estimated 65,000 white collar professionals, according to a survey by specialist staffing solutions firm Xpheno.
Expectedly, perhaps, the sectors that benefited most from the rising trend of purchases over the Net, online education and web-based transactions added the most headcount. Over five quarters from April 2020 to June 2021, Indian unicorns alone added 17 per cent to their headcount over the figures for 2019-20.
Those likely to achieve unicorn status soon, which the survey dubbed “soonicorns” added 30 per cent to their headcount against 6 per cent in the year before period.
“After the initial shock and awe of the pandemic, the predominantly tech-enabled unicorns and soonicorns quickly found their foot with increased consumption by customers," Kamal Karanth, Co-founder of Xpheno told ET, a leading Indian financial daily. “And 2021 started on a fresh note... Consumers' dependency on ecommerce to fulfil a variety of their daily needs has become consistent across more categories of services. As a result of more promising patterns of demand, tech and non-tech hiring has seen growth.”
Data from Tracxn, a company that tracks innovative companies across more than 350 sectors and more than 1,000 emerging themes across 30+ countries, showed that 24 Indian start-ups achieved unicorn status over this 15-month period, more than doubling the count of such start-ups valued at $1 billion to 47. The number of “soonicorns” rose by 67 to 232.
The growth in their business has, expectedly, led to an increase in hiring by almost all these companies. New age start-ups like Zomato, Byju's, BigBasket, Unacademy, Bharatpe, Udaan, Urban Company, Swiggy Vedantu, ShadowFax, XpressBees, Grofers, EcomExpress, Delhivery, Cred and Ninjacart were among the largest recruiters during the period of the pandemic.
This trend of rising recruitments is expected to pick up pace in the coming quarters. The highest number of jobs are expected to be created in functions like analytics, sales, strategy, finance, marketing, engineering, product and design.
Providing tailwind to this trend is the demand created for new technology tools, non-contact formats of transacting business and the trust factor in making online payments that is expected to continue long after the pandemic has passed.
Then, the millions of people in Tier II and Tier III towns and beyond who jumped into the online shopping-learning-transacting bandwagon will give these platforms greater acceptability that will outlast the pandemic.
As their demonstration effect rubs off on their peers, many more people will begin using the services and products offered by India’s unicorns, “soonicorns” and even smaller players. This is expected to bring about a structural shift in India’s shopping behaviour that will need more people at the backend to process.
And this is likely to create a virtuous cycle of employment and growth in the quarters and years to come and fulfil the Prime Minister’s vision of Indian start-ups being at the vanguard of job creation in the country.