December 8, 2016

Demonetisation could take away 400,000 jobs

With demonetisation set to reduce India’s economic growth by 1% over the next one year, the job market is likely to see over 400,000 job cuts.

You should worry if you work in the e-commerce sector, since firms could handover around 200,000 pink slips in the next one year. “Cash on delivery being almost 70% of the overall e-commerce business, the sector is likely to take a hit and lose almost 20% of their headcount in the next few months,” said Rituparna Chakraborty, co-founder at staffing firm Teamlease Services. E-commerce firms currently employ around 1 million people in India.


Besides, the textiles and garments industry, which employ a substantial number of daily wagers, could be hit hard. Of the 32 million people employed by the industry, one-fifth are daily wagers, who mostly get paid in cash. “While on one hand, slow sales increase the possibility of stock returns to manufacturers or affect the order book for the next year due to unsold inventory; on the other, slow sales and consequent liquidity pressures on retailers can result in stretched payments to manufacturers,” according to rating firm ICRA. Similarly, 20% of the 250,000 workers in the leather industry will also be impacted.


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