With no sign of the pandemic coming to an end, combined with the slow pick-up in demand for services, inflationary conditions and the depreciation of the rupee, there seems to be more disappointment in store for those actively looking for jobs in the services sector in India.
The services sector, which should have otherwise provided jobs to millions has become very slow again, with the Nikkei/IHS Markit Services Purchasing Managers’ Index falling to 52.3 in December from 53.7 in November. Even though the fact that the index remains above 50, which means the economy is not contracting and hope for growth is not lost, this sluggishness in the services sector is rather worrisome.
Mainly, it is the spike in COVID cases that has been hampering growth, in terms of new work. Therefore, it will not be surprising if the first half of 2021 poses challenges in the path of recovery. There have been reports of unemployment rate rising in the country. This is because, countries that faced a financial crisis because of the pandemic have set aside hiring till things improve. Many have even laid off employees as they see themselves unable to sustain the workforce without sizeable fresh orders.
Although factories did see a short spurt in hiring, unless and until the demand for services also increases side by side, the services sector will continue to be frustratingly slow in recovering.