Despite the current trend of layoffs among larger corporations, around 80 per cent of early-stage start-ups with a current workforce of under 20 employees are actively seeking to expand their workforce in 2023, states a survey.
The start-ups that have secured Series A and Series B fundings are well-capitalised, and are looking to hire new talent. 92 per cent of these start-ups said that their hiring decisions would primarily be driven by new project orders, additional funding raised from investors, and expansion strategies.
Similarly, 31.92 per cent anticipate an increase in hiring of over 30 per cent, and 28.08 per cent of companies plan to expand their teams in the 11-20 per cent range, according to FICCI – Randstad Start-up Hiring Trends Survey.
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Agriculture and agritech, AI, ML, deep tech, automotive, and e-commerce and delivery services are expected to increase hiring in the 11-20 per cent range, while aerospace and defence, energy, and healthcare start-ups are expected to increase their hiring activities by over 30 per cent. Overall, sectors depicting the highest intent to hire include healthcare ( 13 per cent), IT/ITes (10 per cent), agri/agritech (8 per cent), AI/ML/DeepTech (7 per cent), Fintech (7 per cent), and manufacturing (7 per cent).
“Start-ups create a large range of jobs as they grow and mature. 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, start-ups create jobs and economic opportunities beyond just the top cities and are key partners in India’s growth story,” said Rohit Bansal, Chairman, FICCI Start-up Committee, and Co-founder, AceVector Group & Titan Capital.
The study also states that hiring will primarily occur at the junior and mid-levels. Around 37.97 per cent of start-ups have indicated that they intend to recruit more junior-level employees, while 27.27 per cent 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.
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Furthermore, it was revealed that 54.38 per cent of start-ups attribute the high attrition rate in the industry to factors, including better pay packages offered by larger corporations, concerns over job security in a start-up, and lack of clarity around career progression and credibility.
Also, 57.28 per cent of the surveyed start-ups believe that ESOPs (employee stock option pools) have the potential to serve as an effective instrument for retaining employees. Furthermore, 41.49 per cent of surveyed start-ups have already implemented ESOPs as a retention strategy.
In terms of hiring challenges faced by start-ups, the primary factors include a deficit in requisite skills, mismatches in salary expectations, and a reluctance among potential candidates to join a start-up due to concerns over risk perception.
Also read: VC investment in Indian AI start-ups zooms
“With the emergence of several new-age innovative organisations across sectors, the Indian start-up ecosystem will be a significant contributor to India’s economic growth over the next few years. We believe these early-stage start-ups and their growth ambitions will fuel the next phase of India Inc.’s emergence as the world’s most attractive employment hub,” said Viswanath PS, MD & CEO, Randstad India.
The Federation of Indian Chambers of Commerce and Industry (FICCI) in partnership with Randstad India, launched their exclusive survey on start-up hiring trends. Over 300 start-ups participated in the survey.
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