Hyderabad among top cities hiring senior, junior-level staff: FICCI–Randstad startup hiring trends survey
Hyderabad has figured among the prominent cities -- along with Delhi/NCR, Bengaluru, and Mumbai -- for hiring activity across startups at the junior level also
♦ The survey revealed that 80.49% of the total startups surveyed plan to increase their manpower hiring in 2023, while 15.78% plan to maintain their existing headcount, majority being early stage.
♦ As many as 54.38% of startups attribute the high attrition rate to factors such as better pay packages offered by larger corporations, as well as concerns over job security in a startup.
♦ The sectors depicting the highest hiring intent include the healthcare, IT/ITeS, agri/agritech, AI/ML/DeepTech, Fintech and Manufacturing; while Hyderabad and Pune are emerging as regions exhibiting strong intent to hire for senior-level positions.
NEW DELHI: Hyderabad and Pune are emerging as the frontrunners in senior-level hiring, reflecting a strong intent among startups in these regions. Interestingly, Hyderabad has figured among the prominent cities -- along with Delhi/NCR, Bengaluru, and Mumbai -- for hiring activity across startups at the junior level also.
Middle-level hiring is expected to be prominent across cities such as Kolkata, Bengaluru, Mumbai, Chennai, Pune, and Delhi/NCR.
Despite the current trend of layoffs among larger corporations, a significant proportion (80%) of early-stage startups, those with a current workforce of fewer than 20 employees, are actively seeking to expand their workforce in 2023.
Notably, these startups have secured Series A and Series B funding, are well-capitalized, and are actively seeking to hire new talent. As many as 92% of these startups stated that their hiring decisions will primarily be driven by new project orders, additional funding raised from investors and expansion strategies.
The Federation of Indian Chambers of Commerce and Industry (FICCI) in partnership with Randstad India, one of the leading organizations in the HR services industry, has launched their exclusive survey on startup hiring trends. Over 300 startups participated in the survey.
While startups are planning to expand their workforce, a substantial portion of 31.92% among those surveyed anticipate an increase in hiring by over 30%.
While 28.08% of companies plan to expand their teams in the 11-20% range, sectors like Agri/Agritech, AI/ML/Deeptech, Automotive, and E-commerce/delivery services are expected to increase hiring in the 11-20% rang.
Aerospace & Defence, Energy, and Healthcare startups are expected to increase their hiring activities by over 30%. Overall, sectors depicting the highest intent to hire include healthcare (13%), IT/ITes (10%), agri/agritech (8%), AI/ML/DeepTech (7%), Fintech (7%) and Manufacturing (7%).
The study has also revealed that hiring will primarily occur at the junior and mid-levels. Approximately 37.97% of startups have indicated that they intend to recruit more junior-level employees, while 27.27% of respondents are planning to focus on mid-level hiring. However, the Agri/agritech and automotive sectors will focus more on senior level C-suite hiring.
Attrition main reason for hiring
The survey further indicates that 54.38% of startups attribute the high attrition rate in the industry to factors such as better pay packages offered by larger corporations, as well as concerns over job security in a startup. Other factors contributing to attrition in startups include a lack of clarity around career progression and credibility.
Interestingly, 57.28% of the surveyed startups believe that ESOPs (Employee Stock Option Pool) have the potential to serve as an effective instrument for retaining employees. Furthermore, 41.49% of surveyed startups have already implemented ESOPs as a retention strategy.
In terms of hiring challenges faced by startups, the primary factors include a deficit in requisite skills, mismatches in salary expectations, and a reluctance among potential candidates to join a startup due to concerns over risk perception.
Rohit Bansal, Chairman - FICCI Start-up Committee, and Co-founder, AceVector Group & Titan Capital said, “Startups create a large range of jobs as they grow and mature. As this report highlights, the initial opportunities arise as founders onboard the early team to help establish the business. A multiplier impact on job creation is seen in the growth and expansion stage when operations expand, and various initiatives mature. With their pan-India footprint, startups create jobs and economic opportunities beyond just the top cities and are key partners in India’s growth story.”
Presenting insights from the startup hiring trends survey, Viswanath PS, MD & CEO, Randstad India, said, “With the emergence of several new-age innovative organizations across sectors, the Indian start-up ecosystem will be a significant contributor to India’s economic growth over the next few years. These startups will eventually create unique employment opportunities, innovation and competitive dynamics in the world of work.”
While 57.76% of startups are looking for permanent recruits, only 42.24% are looking to hire temporary and gig workers.
Qualifications in demand
The survey has revealed that 45.21% of startups are looking to hire semi-skilled employees, while 41.49% of startups are seeking highly skilled professionals.
A majority of startups, (67.55%) are focusing on private MBA and engineering colleges, as well as state universities, as these institutes offer quality talent at affordable salary packages. Only a small proportion (9.16%) of startups are opting for premier institutions such as IITs and IIMs for their campus placements.