Mass layoffs have been at the forefront of most news networks today. Companies of all shapes and sizes have been letting go of their talent to cope with fluctuating markets and economic downfall. India’s largest conglomerates seem to be unaffected by these circumstances, though.
Since 2022, we’ve seen multi-billion dollar companies such as Google, Meta and Twitter lay off huge chunks of their workforce. An estimated 28,500 employees have been laid off from these three companies alone, accounting for eight per cent of the total layoffs last year.
In India, the top 10 largest companies, ranked by market cap, laid off only 600 employees since 2022, all of whom were part of Infosys’ most recent freshers’ layoffs. These numbers account for only 1.7 per cent of all layoffs in India and 0.1 per cent of global layoffs.
These statistics beg the question, ‘Are Indian conglomerates the safest bet for the next wave of employees?’
Before we look into that, it’s better we understand the situation as a whole.
Why haven’t they laid off?
To put things into perspective, Indian companies have added to the layoffs this year. Almost ten per cent of all global layoffs have come from Indian companies. Out of those who laid off, consumer service-tech companies form the biggest piece of the pie.
Not all the companies that take up major market cap in India are in the consumer-service sector. They may have subsidiaries in the industry, but are not reliant on those companies for major profits. Therefore, they haven’t resorted to such drastic measures to cut costs.
Out of the top tech companies in India, Infosys and Wipro have carried out quasi layoffs this year, letting go of freshers after carrying out a performance review to sort the high performers and the low performers.
“Large Indian companies usually have long-term goals, and hire accordingly. Those who maintained shorter-term goals faced the brunt of their short-sightedness this layoff season.”
Raj Narayan, ex EVP and CHRO, Titan
Tech companies, in particular, are under tremendous scrutiny and pressure from investors on a quarterly basis. These organisations are questioned by investors even if they see a nominal loss from one quarter to another. One of the easiest ways to cut costs for most of these companies is to lay off a large chunk of their employees as employee-related costs form a major chunk of their running costs.
“India’s largest conglomerates aren’t under constant scrutiny from third-party investors. The costs to run their operations aren’t employee centric. Therefore, they can look at other measures to make up for lost capital,” says Ramesh Shankar, chief joy officer, Hrishti.com
Raj Narayan, ex EVP and CHRO, Titan, expands on a few more points on the subject. “The economic situation in India has not forced companies in the Subcontinent to take such cost-cutting measures, and therefore, have resulted in lesser layoffs”. He goes on to add, “Outlook also plays a significant role in such situations. Large Indian companies usually have long-term goals, and hire accordingly. Those who maintained shorter-term goals faced the brunt of their short-sightedness this layoff season.”
The new generation of employees has been widely documented as a generation that understands how their professional needs must coincide with their personal gains.
In these terms, what do India’s conglomerates provide them with that other companies don’t?
Many of the top companies in India are age-old establishments with pre-existing company philosophies and a strong culture. One of the main reasons why groups such as Tata boast of long average tenures is successful inculcation of a company culture in their employees.
A strong company culture provides employees with a sense of belonging and direction. An established organisational identity creates an environment with little room for confusion, streamlining company goals and steering the employees towards the right direction.
“Employees today look for the best option for the time being and hop to the next as soon as needs be, thus not creating a situation where they can leverage the long term benefits provided by such companies.”
Ramesh Shankar, chief joy officer, Hrishti.com
Most of India’s established conglomerates are over three decades old. Hence, they have had ample time to form a strong bond with tenured employees and nurture an efficient and happy work environment.
New-age employees will have to understand that joining these organisations will mean buying into and moulding as per the pre-existing company culture. The Gen Z worker prioritises flexibility over most things, and therefore, and may find this kind of rigidity to be an inhibitor to their overall growth.
Since the pandemic, we have witnessed glimpses of change in some of these organisations. After repealing the work-from-home mandate, Reliance and Bharathi Airtel adopted flexible work models for their employees. A need that was expressed by the employees and acted on by the organisations.
The same should be true for the next generation of workers. If employees want better opportunities, it should be understood that sacrifices have to be made both by the employee and the employer.
One aspect of a strong organisational culture is the ability to retain employees for prolonged periods of time.
Retention cannot solely be accredited to a solid work environment. Opportunity has played a large role in why people tend to stick to these organisations. The ability to expand one’s horizons without leaving the comfort of a pre-existing structure is a big reason why many choose to stay on.
Reliance, Tata and other large conglomerates create many avenues for the employees to explore different roles. If they perform well, they enjoy the freedom to explore opportunities in settings that would otherwise have required them to quit and find other jobs. The nexus of companies formed by these conglomerates provides the employees career-advancement opportunities.
Compensation has usually not been a point of contention at these large corporations. Rather, Indian conglomerates have been praised for their compensation and benefits drives that help keep key members of their organisations from moving on.
“As most of the production centres of these organisations are situated in remote places, the location and the socialising and/or entertainment opportunities are less attractive to new-age workers.”
Jaikrishna B, group head – HR, Amara Raja Group
Ramesh Shankar believes, “the new generation of employees don’t look to stay at an organisation for long periods of time. Employees today look for the best option for the time being and hop to the next as soon as needs be, thus not creating a situation where they can leverage the long term benefits provided by such companies.”
For employees today, finding an opportunity that suffices their short-term goals is ideal. Growing as an individual, along with being a well-rounded professional takes precedence over anything.
Narayan talks about there being no apparent disadvantages to joining an established conglomerate.
“As long as employees are not swayed by their short-term goals, joining an established institution gives them a solid foundation to grow on, with ample risks and rewards.”
Jaikrishna B, group head – HR, Amara Raja Group, sees a few ways in which employee can be dissuaded from joining such organisations.
“As most of the production centres of these organisations are situated in remote places, the location and the socialising and/or entertainment opportunities are less attractive to new-age workers. Further, lack of automation in case of a manufacturing shop floor or absence of an air conditioned environment may also act as dampeners, making them choose opportunities in other sectors that offer better working conditions,” says Jaikrishna B.
A Forbes article has urged new employees to expand their horizon past the tech sector and look for opportunities that provide better pay, with a more stable work-life balance.
In the end, although there are tangible benefits to joining established conglomerates, the mind-set of the next-gen employee will have to be moulded to fit the needs of these organisations.
Taking all these points into consideration it can very well be summarises that joining large companies may still be the safest option for those looking to gain in the long term.