The Year of the Snake to bring a balance in job market

“Our hiring outlook remains positive in the medium term, especially in high-demand skills such as AI/ML, data science/analytics, IoT, ESG, cloud and digital transformation, while we continue to have aggressive plans to hire in 2025 on the back of strong demand across all our business," said Reena Wahi, partner and head of people, performance and culture, KPMG in India.

While a larger part of 2025 will remain an employer's market, those who manage to get the skillsets in demand are expected to command a premium price during a job shift.

“IT and Global capability centres will see an uptick in the attrition numbers," said Aditya Narayan Mishra, chief executive officer of CIEL HR Services, a staffing firm. “There is also a demand for junior investment bankers at companies headed for listing on the bourses is expected to increase."

India saw a record mop-up of about ₹1.8 trillion in 2024 through initial public offerings (IPOs), according to data collated by Motilal Oswal Financial Services. Analysts expect the momentum to continue well into 2025.

Also read: Consumer goods companies go full throttle on rural hiring

Over the last couple of years, the fast-moving consumer goods (FMCG) segment has seen cyclical hiring and rural consumption is expected to propel the pace of recruitment in 2025. To be sure, demand for goods is likely to remain subdued next year as high inflation hurts real incomes, eroding consumer confidence, market research firm Kantar said in its outlook for 2025.

Still, Balasubramanian Ananthanarayanan, senior vice-president for Teamelase Services, expects a 10% growth in hiring by FMCG firms in rural segment. “Urban inflation is high, especially house rentals, leading to sluggishness. This has pushed FMCG players to focus on rural markets whose growth has outstripped their urban counterparts in the last three quarters," he said. “Consumers in smaller cities are increasingly demanding higher quality and variety of products and a better buying experience too. While labour is relatively cheaper, multiple skills need to be imparted for them to be effective."

During festive seasons, quick commerce is expected to attract temporary talent with daily incentive rewards. It is getting tougher to attract workers from one state to another and the battle to hire will continue between manufacturing, construction and real estate, and hospitality sectors in the coming year.

Back to office

In October, Mint, citing data from property advisor CBRE India, reported that office leasing is likely to see a historic high of 70 million sq. ft in 2024, across nine cities, surpassing the peak of 66.6 million sq. ft seen in 2019. That is a sign companies want to ensure that more employees are back at the office and flexible work hours are a manager's prerogative.

Yet, in the offices, the clash between the generations may become starker as the older alphas (the generation born after 2010) share workspace with Gen Z (born between 1996 and 2010), the millennials (born between 1981 and 1996) and Gen X (1965-1980). Companies will have to work on their diversity parameters, customize benefits to suit the different age groups and be open to dealing with such confrontation. A company's brand image as an equal-opportunities employer and efforts to deal with employee angst will be a prominent factor while attracting talent.

Also read: IITs bring in phone a friend to help students during placements

Pay hikes in 2025

The coming year will, however, not see any big jumps in compensation and a job hop will no longer command the 50%-plus hikes, with little negotiating power in the hands of the candidate. “A 15-25% compensation hike is a balanced demand and will sit comfortable with both the candidate and the employer," said Shiv Agrawal, managing director of ABC Consultants. “The CXO's compensation will increase but the emphasis will be on the variable and bonus payouts."

Consulting firm Aon estimates a 9.5% average hike in 2025 across sectors versus an actual raise of 9.3% in 2024. Engineering, manufacturing and retail industries project double-digit increases at 10%, followed by financial institutions at 9.9%.

Investment bankers are set to get record bonuses for 2024, after fetching the decade's highest fee income driven by share sales, mergers and debt funding rounds. According to Native, a search firm that also works with the financial services sector, bonuses may cross ₹1,000 crore in 2024, of which ₹700 crore may go to over 350 top executives. These include managing directors, partners and directors at global and domestic investment banks earning an average fixed salary of ₹15-25 trillion. These bonuses will roll out in the January-March period of 2025.

The hikes and bonuses need to be considered on the back of inflationary pressures. Retail inflation was expected to be lower this year. However, it saw a sharp spike from September onwards due to the rise in vegetable prices. That said, Reserve Bank of India expects this trend to reverse next year.

Also read: Exploring the rise of new players in B-School placements

And while the employers will be keener to bring in experienced hands, the campus graduates may have better luck in finding jobs than in the early part of 2025. The initial reports of campus placements in engineering colleges show a healthy appetite among public sector units (PSUs), startups, and banking, financial services and insurance firms to recruit young graduates.

A notable difference in 2025 will be a larger number of hiring from campus placements. The initial phase of hiring from India’s leading engineering colleges in second half of 2024 came as a solace to colleges. Consultants, algo-trading companies, PSUs, banks and startups recruited from engineering colleges and a similar need for talent is also expected to propel hiring from B-schools. The placements at management colleges will start from February onwards.

Although the demand will not be on a par with the second half of 2021, 2022 and first part of 2023 when companies were making up for the momentum lost during the pandemic, it is still expected to be better than most of 2024.

However, students will have to look at the skillsets in demand and may have to make a quick change in their profiles and learn more about artificial intelligence (AI), a top skill that recruiters are looking for.

Once in the workforce, employees will see increased scrutiny of the data that they have access to. This is because the ever-bulging employee databases of companies are increasingly getting leaked into the internet for want of adequate security measures.

Cybersecurity analysts note that there has been a 20% increase in data breaches from corporates since 2022, including employee data.

Also read: PSUs lock horns with private firms to hire from IITs

IBM’s global ‘Cost of a data breach, 2024’ report said that employee personally identifiable information (PIIS) was a part of 40% of all breaches reported this year, which increased 10% over 2023. The average cost of leaked employee information to businesses rose to $189 million for each breach—a 4.4% year-on-year rise. The overall cost of a data breach, $4.88 million this year, is at its highest ever.

Companies will ask both their recruitment vendors and HR teams to be aware of the risks of data breaches while hiring. While matching job hiring mandates with the candidate’s skills, many HR heads upload resumes on ChatGPT, which means the data of the candidate is available to others.

Nonetheless, for the job seeker, the year of the snake may slither in better times.