Market Indicators
Global Spotlight on India THE COUNTRY IS CERTAINLY A TOUGH NUT TO CRACK FOR EMPLOYERS AND RECRUITERS ALIKE, BUT IT IS TOO LARGE A MARKET TO BE WRITTEN OFF BY EITHER
key indicators
Yes, low wages make earning decent margin tough, and complaints that contracts and meetings are all too easily broken are widespread. But with a population of 1.24bn — that’s over a sixth of the global total — India cannot be ignored. Marie Moynihan, vice president for global talent acquisition at computing giant Dell, tells Recruiter that globally, the company is trying to bring agency use “as close to zero as possible”. “There are some countries where we believe it’s going to be very challenging and I would say India is one of them… the talent pool [candidates] has a preference to have an agency represent them,” she says. Another difference is lesser emphasis on social media. “It would be a much smaller percentage than in the US and in Europe,” Moynihan explains. As is the case globally, employee referral remains Dell’s largest hiring source in India, he adds. Moynihan cautions that “it would tend to be the local agencies rather than the big names” that Dell works with in the country, and confirms that margins can be very low, typically around 8% for their volume recruitment. But Robert Jan van de Kraats, an executive board member at recruitment group Randstad, who has India in his portfolio of countries, says the market, where they focus on “white collar volume recruitment, individual specialist recruitment and professional project-based staffing”, is “very important” to the group. “Generic staffing is in an early stage of development, where currently it appears to be more a payrolling activity,” he adds. The staffing industry’s growth is
MANPOWER EMPLOYMENT OUTLOOK SURVEY FOR INDIA 60
■ Firms increasing headcount% ■ Firms decreasing headcount%
India boasted 17m LinkedIn members as of October 2012 — just one in 73 of the whole population, compared to over one in five in the US and one in six in the UK. The country is due to overtake China as the world’s most populated within 15 years. Jobseekers in India are more likely to use overseas or international job sites (60%), search engines (53%) or national job sites (45%) than the global workforce as a whole (52%, 40% and 35% respectively), according to Intelligence Group research. Just over half of the Indian labour force is employed within agriculture. Currency: Indian Rupee (INR): INR 100 = £1.13 ($1.82)
demonstrated by the fact that the Indian Staffing Federation only launched in summer 2011. Moynihan’s expectations that “India will go down the same road” as the West eventually — is shared by Oliver Turnbull, founder of digital recruiter Incite People, which established an Indian office in 2010. “I think in the next 12-18 months you’ll see a huge drive in recruitment agency demand — and I think eventually you’ll see a huge drive for internal recruitment,” he says. Incite People “won’t work for anything less than £2,000 in fees” in India, and Turnbull agrees with Moynihan’s view that the prestige of being represented by an agency aids business. “To be represented by a British company is a huge, huge thing [for candidates]… those things do really count,” he continues. Incite People also offers a service called buildmyteam.co.uk, which handles not just recruitment but broader aspects of creating an Indian operation, including legalities, payroll and facilities. Especially in the four major tech cities — Bangalore, Delhi, Hyderabad and Mumbai — facilities expenses are substantial. “What you find sometimes is that the actual office space is more expensive than the labour that sits at the desk… it’s comparable to the centre of London.” Setting up is tough too. Turnbull describes a “huge checks and balances process… it’s a really long slog, something you’ve really got to commit to and really keep a shrewd eye on, otherwise you can spend a lot of time and not get anywhere”. With that shrewd eye, the possibilities are tremendous. SPONSORED BY
SAM BURNE JAMES sam.burnejames@recruiter.co.uk
INDIA VERSUS THE OTHER BRICS ■ Brazil ■ Russia ■ China ■ India 15 12
50
YEARLY GDP GROWTH
9
40
6
30
3 0
20
-3
10
-6 0
Q4 Q1 Q2 2010 2011
Q3
Q4
Q1 Q2 2012
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Q3
Q4
-9
2006
2007
2008
2009
2010
2011
2012
INTERNATIONAL MONETARY FUND (2012 DATA PREDICTED)
“Impossible!” “No way, you can’t do it”. These were the reactions of two successful UK IT recruiters upon hearing an upcoming Global Spotlight on India would investigate how agencies can make money in this daunting, behemoth of a market.
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JANUARY 2013
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10/01/2013 08:36