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Hiring activity is slowing, but guess who is in demand? Gig-workers; here's why

Hiring activity is slowing, but guess who is in demand? Gig-workers; here's why

As per a new report from RazorpayX Payroll, the business banking platform of fintech giant Razorpay, reveals that hiring of new permanent employees has dipped by 61 per cent as compared to October 2021.

Hiring activity is slowing, but guess who is in demand? Gig-workers; here's why Hiring activity is slowing, but guess who is in demand? Gig-workers; here's why

The changing dynamics of the start-up ecosystem has resulted in massive shifts in hiring patterns in the last twelve months. The Annual Insights Report by RazorpayX Payroll, the business banking platform of Razorpay, has revealed that hiring of new permanent employees has dipped by 61 per cent as compared to October 2021. “Indian start-ups see the great normalisation with many start-ups facing the chills of funding winter; most of them are cutting back on their hiring,” the report said.

Another dip in hiring was seen across seniority with the CXO hiring noticing a massive normalization, dropping by 93 per cent since October 2021. “While hiring across departments has decreased, hiring in technology seems to have been least impacted. Technology-related jobs have managed to marginally increase their contribution to the overall workforce by 4 per cent while the hiring trend is slowing down in general,” the report added.

“The Indian start-up ecosystem has been facing headwinds in the past few months but they have been nothing short of resilient and adaptive to such a dynamic environment. The data from RazorpayX Payroll indicates that start-ups have been optimising their workforce by building leaner yet stronger teams, keeping in mind the macro-forces,” Shashank Mehta, Vice President and Head, RazorpayX, said. “Moreover, compensating their existing employees for their contribution towards building sustainable runways in the long run shows that companies have been looking inwards, alongside the increasing adoption of giggers.”

Gig economy, however, is the new norm of work. While hiring permanent employees has seen a fall, giggers seem to be the preferred way to go for start-ups. “Payments to gig-workers have seen a growth of 153 per cent since October 2021. The total number of enterprises who have shifted to a semi-gig workforce model has increased by 15 per cent since October 2021,” it added.

“Coupling this trend with rising salaries across key roles, we will soon see a new era of work among start-ups,” he said.

As per the report, semi-skilled gig-workers, who are paid less than Rs 20,000, have the highest contribution to the entire pool of gig-workers being hired by start-ups, followed by those who earn anywhere between Rs 20-40,000. 

“However, these workers are one of the slowest growing cohorts growing at 26 and 52 per cent, respectively. However, skilled gig workers who earn between Rs 85,000 to more than Rs 150,000, although contributing the least to the overall pool, have seen the highest growth in the last one year,” it said.

The report added that gig-workers who earn between Rs 85,000-150,000 have grown by 62 per cent, while gig-workers who earn more than Rs 150,000 grew by 69 per cent in the last one year. “This goes on to show that gig-workers are gaining more popularity among startups than hiring full-time employees,” the report said.

Despite a drop in hiring, salary spends is on a rise. “While overall hiring has decreased, salary spends have increased by 64.7 per cent since October 2021. Contrary to previous trends, salaries across different salary levels have been rising gradually but not exponentially, at an average of 12 per cent,” it said.

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