India Inc looks to smaller towns to bridge growing skills gap

Amrita Nair Ghaswalla Mumbai | Updated on December 03, 2014


Metro job markets saturated, new catchment areas hold key to future recruitment

A growing shortage of skilled manpower in metros is sending companies scurrying to smaller towns to look for people with the skill sets they need. Human resource departments say hiring from these new catchment areas has helped address the paucity of talent, a problem faced by many companies. For employers, the advantages of hiring from smaller towns are lower wages, access to talent and professional skills.

Smaller towns are emerging as key recruitment areas, and they are being supported by the state governments, says Debi Prasad Das, Senior Vice-President - Human Resources, Ceat Ltd.

Rajesh Save, Global Head - Human Resources, Syntel Inc points out: “On the one hand, we have overgrown, overexposed and overexploited skills reservoirs in urban areas with huge demand and less supply. On the other hand, there is a scarcity of opportunities, but abundant supply of potential talent waiting to be harnessed (in smaller towns).’’

Industry would hire from wherever talent is available, especially in a globalised world, Save says, adding, “Recently, a student of BITS, Goa, landed a job at Google in the US with a package of over ₹1 crore as starting salary. This would have been unthinkable a few years ago.”

Ajay Kela, CEO, Wadhwani Foundation, concurs: “With the shift from an agricultural to a manufacturing and service economy, urbanisation of India is on the rise, as is the migration of skilled labour to smaller towns.’’

Talent and access to learning are no longer restricted to big metros, Kela says. “Companies understand the importance of nurturing talent in smaller towns, and are not restricting themselves to larger cities anymore.”

New geographies

The Wadhwani Foundation is a philanthropic organisation that has committed ₹613 crore to create 25 million jobs in the country.

With employers constantly looking to hire from new areas, Ceat’s Das says fresh catchment areas have sprung up. “Bhubaneshwar in the East has a huge pool of talent, followed by Visakhapatnam in Andhra Pradesh. In the West, Baroda is emerging as one of the favourite destinations.”

“Raipur, Nagpur, Indore in Central India, and Belgaum, Goa, Kolhapur and Nasik in the West are being regularly scoured by companies for hiring,” he adds.

Syntel’s Save says supply is “clearly shifting from big cities like Mumbai, Pune, Hyderabad, Chennai to the new boom towns like Tirunelveli, Coimbatore, Indore, etc.”

Even smaller cities such as Mehsana, Jadavpur, Jalandhar or Ranchi, “that were not on the global job map, now have national and international companies making offers to students.”

Driving down costs

Besides lowering costs, firms hiring from these towns also enjoy better institutional throughput of talent, improved geographic access, and get tax breaks for manufacturing set ups.

Since these smaller cities have good colleges, vocational centres and availability of the required infrastructure, talent acquisition is picking up, says Ceat’s Das.

A recent report by TeamLease, a human resource outsourcing and staffing company, says that recruiters have identified several new catchment areas to hire from over the next half year. These are Hindupur, Visakhapatnam, Hubli, Belgaum, Thiruvananthapuram, Aurangabad, Kota, Ajmer and Meerut.

Hussain Tinwala at TeamLease Services says, “With newer, technologically advanced modes of talent acquisition, employers are able to bridge the skills gap more efficiently. The slack in talent demand may have clearly bottomed out.”

“Higher salary expectations in the metros, longevity of employment in smaller towns, and a diversified culture,” have got companies hiring from smaller towns at junior levels, he says.

Some of the largest employers in the country have senior managers who hail from smaller towns, says Kela, adding: “Tier II and III markets are increasingly producing notable talent. We are witnessing their tenacity in vocational-linked education programmes.”

Published on December 03, 2014

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