The Sensex has been on a high, but not the stock brokerage business.

According to SEBI data, 522 brokerages and 12,855 sub-brokers in the cash segment shut shop in the first six months of this fiscal ended September. That translates into potential job losses for about 40,000 industry hands.

Assuming that on average each sub-broker employs two people, the number of jobs lost in just the sub-brokerage business across India would be about 25,710, according to a back-of-the-envelope calculation.

Similarly, assuming that about 5 per cent of the 522 shut brokerages are multiple-branch offices employing an average of 100 people and the remaining 95 per cent are single branch brokerages employing about 20 people each, a total of 12,520 people would have lost their jobs, say industry watchers.

Even as this oversupply of laid-off brokers, dealers and analysts floods the job market on the one hand, new job openings in stock brokerage-related jobs, such as analysts and dealers, are down 10 per cent since last year.

As brokerages put their expansion plans and fresh hiring plans on hold, the number of new job openings in the stock market sector has fallen to 362 in October 2013 from 406 in October last year, according to, one of the largest job portals in the country. With the economy passing through a slowdown, brokerages and sub-brokers have been forced to shut shop due to low market volumes, rising costs, squeezed margins and cut-throat competition.

Recently, HSBC announced the closure of its retail broking division. Three-hundred jobs disappeared. This was followed by India Infoline, which has begun scaling down its retail business. The company, however, declined to provide details on the number of jobs that will be affected.

Rajiv Parmar, 28, who was once employed as a sub-broker in Mumbai’s upmarket Nariman Point, now sells suitcases and bags while some of his colleagues have joined call-centres or have taken up other sales jobs.

“I thought selling suitcases was better than sitting at home and doing nothing, though I miss the thrill and charm of the stock market. My friends in other brokerages, which have downsized, are no better off as they are being made to double up as dealer-cum-relationship managers now for the same salary,” he rued.

Cautiously optimistic

HR managers in top brokerages maintained a cautiously optimistic outlook and said that hiring hinges on economic policy certainty and a stable government after the elections, besides a sustained rally in the equity markets based on improvement in fundamentals.

“Markets have just started picking up and we are waiting for it to stabilise before re-starting any fresh hiring,” said Jaya Jacob Alexander, HR Chief, Geojit BNP Paribas Financial Services.