India, along with the rest of the world, is witnessing a wave of layoffs. Over the past two years, an estimated 100,000 people have been laid off by tech firms alone in India and other sectors have not been immune to the contagion either. Blame it on choppy revenue figures, falling valuation, supply chain disruptions and other factors.
The job losses come at a time when unemployment is high and prospects seem bleak. Also, other than the economic cost of job losses, there are social and emotional implications. India, therefore, needs some sort of safety net.
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[00:00:00] Hello and welcome to All Indians Matter, I am Ashraf Engineer.
[00:00:12] Have you been hearing of the massive layoffs across sectors but especially in the technology
[00:00:17] space?
[00:00:18] It's a contagion that's spread across the world but is felt perhaps most severely in
[00:00:23] India because of the lack of alternative jobs and the large number of people we are adding fired more than 5,000 employees as it fended off lenders and its valuation fell more than 90%. Employees, it is widely said, fear more cuts this year. Even Unacademy, Ola and Vedantu have laid off many. Paytm and Reliance Geomart also shed more than a thousand jobs in 2023. In fact, layoffs have become entrenched over the past four years. According to a range of factors, an uncertain global economic landscape, runaway inflation, supply chain disruptions, slowing year on your revenue growth and revenue per employee. The layoffs seem to have come in two waves. First, the period after the COVID-19 pandemic when companies struggled to survive and then when central banks started hiking interest
[00:03:01] rates since the second quarter of 2022. Don professionals are also often over-qualified for the jobs available or unwilling to take the kind of pay cuts that would get them into the consideration set. The loss of employment comes at an emotional as well as social cost. The period for which laid-off workers find
[00:04:24] themselves without jobs tends to be quite long. They are also perceived as non-performers not find a spouse, get divorced or remain childless. The information technology industry accounts for 7.5% of India's GDP and employs 5.4 million people. So, layoffs hurt. This in turn requires policy intervention that protects workers while not getting in the way of industry growth. One solution could be unemployment insurance, which has helped in countries like the US
[00:05:42] and Canada.
[00:05:43] Such insurance cushions the impact of a job loss on individuals and the economy by enabling