Major ecommerce companies and logistics services providers have increased hiring of blue-collar temporary workers by about 50% during the second quarter to gear up for the upcoming festive season, according to estimates by third-party staffing agencies.
Even as the ramp-up by the likes of Amazon, Flipkart, BigBasket, Shadowfax and Ecom Express continues, businesses are being cautiously optimistic and mindful of costs this year, staffing services providers told ET.
These jobs are mostly temporary gigs in supply chain roles such as delivery executives, pickers, packers, and sorters.
“Ecommerce is one of the few sectors hiring today, but the baseline has changed drastically…all e-commerce and logistics companies are taking calculated steps,” said Rituparna Chakraborty, co-founder of TeamLease.
These companies are choosing variable pay models to cut down on liabilities, including lowering fixed costs per executive, moving staff to daily wages instead of monthly billings, and negotiating harder on the cost of hiring.
This is largely because forecasting the way regulations will be enforced amid the Covid-19 outbreak is a big risk this year.
“There is a stronger focus on variable-isation and flexibility…companies don’t want on-roll executives, and they rather pay per job on outsourcing to keep the risk down,” Suraj Moraje, CEO and executive director of Quess Corp told ET.
The cost per executive hired has come down by 10-20% depending on the company, even as costs related to healthcare insurance have been added, according to Pravin Agarwala, the cofounder of Betterplace.
However, Agarwala’s estimates show that overall hiring in the third quarter compared to the second has gone up by 50-60%.
To be clear, businesses hire a quarter in advance to bulk up on trained staff for the festive sales season.
“Companies are looking at more flexibility…for example, minimum fixed costs, with a bonus model,” Agarwala said.
Earlier this week, Flipkart said it will create 70,000 direct seasonal jobs, while in May, Amazon said its India unit will add 50,000 seasonal jobs across its fulfilment and delivery networks.
BigBasket expects to generate 3,000 additional jobs, while logistics firms Shadowfax and ECom Express said they will offer 30,000 new jobs.
“The Indian Premier League colliding with festive sales means a boom in both food and e-commmerce,” said Abhishek Bansal, CEO at Shadowfax.
The festive season sale, beginning in October from Dussehra and extending till about Christmas, is the peak consumer purchase period. IPL begins on September 19.
Offline recovery weak
This year, ecommerce and healthcare have largely hired blue and grey collar workers, while the traditional retail industry and daily labour segment has taken a massive hit.
“By generating employment …we’re doing our part to drive growth in the industry and the economy,” said Amitesh Jha, senior vice president, Ekart and Marketplace, Flipkart.
According to experts, the unemployment caused due to layoffs across the top industries has more than offset the shortage, which was earlier expected due to migration of labourers to their hometowns.
“Supply is not a constraint… overall labour migration has mostly been in daily labour segment… these are not the type of people that work typically in ecommerce,” said Moraje of Quess Corp.
Chakraborty of Teamlease also said that youth from the retail and lifestyle sectors were available, and although these openings may not be aspirational, they will take it up given the current situation.