Mumbai: In what can be seen as confirming fears of a jobless growth in the country, Care Ratings on Wednesday said employment growth in corporate India moderated to 3.8 percent in FY18, from 4.2 percent in FY17, with jobs in smaller companies being hit the hardest.
The rating agency in its report said the moderation in employment growth is "reflective of the proposition that higher economic growth is weakly translating into higher job creation".
It can be noted that many watchers, including the then Union labour minister Bandaru Dattatreya have questioned if we are facing a jobless growth, where the economic acceleration is not translating into growth in jobs.
The report, based on an analysis of over 1,600 corporates, said smaller companies, with net sales of less than Rs 500 crore, have witnessed a contraction in employment growth, while larger companies, with over Rs 500 crore sales, had a positive employment growth in FY18.
With a 14 percent growth, the finance sector led the pack in job creation, followed by retail (13.05 percent), construction (9.6 percent), infrastructure (9 percent) and ratings (8 percent), according to the report.
On the negative growth front, telecom topped the chart with a 7.6 percent decline in job creation, followed by education and training registering a 5.3 percent dip.
In May 2017, Dattatreya conceded that the jobless growth is real and had also constituted a taskforce on it.
"The current growth is a jobless growth. Many European and Asian countries, including India, are facing it...growth is being reported but it is not reflecting in employment generation," he had said in May last year.
From a cost perspective, the overall employee cost came at 8.3 percent in FY18, while the average employee cost rose 4.3 percent, according to the report.
Just like growth in total permanent employees has seen a moderation in FY18 over FY17, both employee cost and average employee cost also witnessed a moderation in FY18 over FY17, it said.
Updated Date: Oct 17, 2018 18:34 PM