In an interconnected world, the ripples of a global economic slowdown are felt far and wide. As economies grapple with challenges, the repercussions extend to various sectors, including job markets. In the context of India, where a significant portion of the population is young and entering the workforce, the impact on fresh hiring is a critical aspect to explore.

The Global Economic Slowdown

The global economy is intricate, influenced by factors such as trade tensions, and geopolitical uncertainties. The slowdown is driven by high-interest rates, soaring energy prices, and geopolitical tensions. Inflation is at historic levels. Japan’s economy contracted by 2.1% in Q3 2023. Economists predict global growth to slow from 2.9% this year to 2.6% in 2024, with “mild recessions” possible in Europe and the UK. China’s growth may weaken.

These elements collectively contribute to a slowdown that affects the job markets worldwide. As multinational corporations reassess their strategies and investments, the consequences are inevitably felt in countries like India, which heavily rely on global economic trends.

The Impact on Engineering Grads Recruitment

The global economic slowdown has impacted the freshers in multiple ways. A few key impacts are listed below:

Reduction in Entry-Level Positions: Companies, facing economic uncertainties, often adopt a cautious approach by reducing entry-level positions. This affects recent graduates who are ready to step into the professional world, creating a challenging environment for freshers.

Increased Competition for Limited Opportunities: With a decrease in job openings, the competition intensifies. Fresh graduates find themselves vying for a limited number of positions, making it imperative to stand out in a crowded job market.

Impact on Skill Development: A slowdown may also influence the types of skills in demand. Industries experiencing a downturn might prioritize specific skill sets, leaving fresh graduates with different qualifications facing additional challenges.

Delayed Career Progression: The economic slowdown can lead to a delay in career progression for freshers. Reduced hiring means fewer avenues for professional growth and development, impacting the long-term trajectory of careers.

Impact on Engineering Grads

External economic conditions impact the engineering fresher intake significantly in India. The slowdown’s impact on Indian engineering grads in particular may be significant. A few key aspects are discussed below:

1. Reduced Fresher Intake

●      Traditionally, the Indian IT services industry has absorbed 20-25% of the 1.5 million engineering graduates annually.

●      However, in FY2023-24, this absorption rate is expected to halve to 10% due to the global slowdown.

●      Indeed research data indicated fresher hiring in India has been on a downward trend over the last three years, since the pandemic. Since December 2021, fresher job postings have declined by 8.5% whereas job clicks have declined by 34.3%.

●      Indeed said that in the last year, there has been a 4.2% decline in the jobs posted for freshers in December 2023 compared to December 2022.

●      Major IT companies, including Infosys, have scaled back their hiring plans, leading to a reduced intake of freshers.

●      Some IT companies have decided not to visit college campuses this year for fresher recruitment.

2. Skill Gap Challenges

●      Amid muted market sentiments and intensified skills evaluation mechanisms, there exists a widening skill gap among freshers.

●      Research data shows that only 45% of applicants currently meet well-rounded proficiency expectations.

●      Companies seek a combination of soft skills (communication, problem-solving, teamwork, emotional intelligence) and hard skills (technical proficiency in programming languages, software development methodologies, cloud computing, and data analytics).

●      Freshers can benefit from improving their digital aptitude and proficiency in utilizing digital tools and technologies.

3. The Euphoric Days and the Current Scenario

●      In the euphoric days leading up to 2021 and until September-October 2022, major IT firms like TCS, Infosys, Wipro, HCL, Tech Mahindra, Cognizant, and Accenture hired 800,000 freshers over the past two financial years.

●      However, the current scenario is different, with freshers facing endless onboarding delays.

●      The demand decline in key markets, especially the US, has prompted companies to be cautious about hiring.

Here are 10 things that students can do to win in this environment

Though reduced yet there are many opportunities for freshers in the market.  The industry needs freshers. Here is what a fresher can do to win in this competitive market.

1. Decide on Your Career Path: Understand your interests, strengths, and skills. Choose a career path that aligns with your passion and aspirations.
2. Master Communication Skills: Effective communication is essential. Focus on improving both written and verbal communication. Fluency in English is particularly valuable, as it’s the global business language.
3. Craft an Impressive Resume: Your resume is your first impression. Keep it concise, clear, and tailored to the job you’re applying for. Highlight relevant skills, achievements, and experiences.
4. Develop Problem-Solving Abilities: Employers value candidates who can think critically and solve problems. Work on skills like creativity, time management, teamwork, and research. Showcase your ability to handle challenges.
5. Gain Practical Experience Through Internships: Internships provide real-world exposure. Seek internships related to your field of interest.
6. Network Actively: Attend industry events, webinars, and workshops. Connect with professionals on LinkedIn. Networking can lead to job referrals and valuable insights.
7. Stay Updated on Industry Trends: Read industry blogs, news, and reports. Understand emerging technologies and market shifts. Adaptability is crucial in a dynamic job market.
8. Upskill and Certify: Continuously learn and acquire new skills. Take online courses or certifications. Showcase your commitment to self-improvement.
9. Prepare for Interviews: Research common interview questions. Practice mock interviews with friends or mentors. Be confident, articulate, and well-prepared during interviews.
10. Stay Positive and Persistent: Job hunting can be challenging, especially during economic slowdowns. Stay positive, maintain a growth mindset, and keep applying. Persistence pays off in the long run.

Initiatives that the teaching staff can take

Here are some specific actions tat the institutes  can take to enhance students’ readiness for the job market during economic slowdowns:

1. Experiential Learning: Encourage practical learning through case studies, real-world projects, and internships. Provide opportunities for students to tackle real-world problems individually and in groups.
2. Industry Collaboration: Forge partnerships with employers to understand industry requirements. Invite industry experts for guest lectures and workshops.
3. Transferable Skills Focus: Beyond core subject knowledge, emphasize transferable skills like communication, critical thinking, and adaptability. These skills are valuable across various roles and industries.
4. Curriculum Alignment: Ensure that the curriculum aligns with current industry trends. Regularly update course content to match evolving demands.
5. Digital Literacy: Equip students with digital skills required for remote work and virtual collaboration. Familiarize them with online tools and platforms.
6. Reflective Practice: Encourage students to reflect on their experiences. Help them learn from internships, projects, and industry interactions.
7. Supplemental Learning Resources: Offer bite-sized courses or pre-class materials. Prepare students for in-depth discussions during live classes.
8. Career Guidance: Provide personalized career counselling. Assist students in setting career goals and developing job-search strategies.
9. Entrepreneurship Support: Foster an entrepreneurial mindset. Encourage students to explore start-up ideas and innovation.
10. Lifelong Learning Advocacy: Instil a culture of continuous learning. Motivate students to pursue certifications and skill development beyond graduation.

Initiatives that the institutes can take

Here are 10 key strategies that educational institutions can adopt to increase their students’ chances of getting hired:

1. Curriculum Alignment with Industry Needs: Regularly update course content to match industry trends and demands. Include practical skills, case studies, and real-world projects to bridge the gap between theory and practice.
2. Internship and Work-Integrated Learning Programs: Collaborate with companies to offer internships, co-op programs, and apprenticeships. Provide students with hands-on experience and exposure to workplace dynamics.
3. Soft Skills Development: Conduct workshops on communication, teamwork, problem-solving, and time management. Soft skills are crucial for success in any job role.
4. Career Counseling and Guidance: Offer personalized career counseling sessions. Help students identify their strengths, interests, and career paths.
5. Industry Guest Lectures and Workshops: Invite industry experts to share insights and experiences. Organize workshops on resume writing, interview skills, and networking.
6. Certifications and Skill Enhancement Programs: Encourage students to pursue relevant certifications. Provide access to online courses and skill development platforms.
7. Networking Opportunities: Arrange networking events, job fairs, and alumni meet-ups. Networking helps students connect with potential employers.
8. Entrepreneurship and Innovation Support: Foster an entrepreneurial mindset. Encourage students to explore startup ideas and innovation.
9. Research and Industry Projects: Collaborate with industries on research projects. Involve students in solving real-world problems.
10. Emphasize Lifelong Learning: Promote continuous learning beyond graduation. Encourage students to stay updated with industry developments.

Conclusion:

While the global slowdown poses challenges for fresh hiring in India, proactive measures can help individuals navigate these uncertainties. As the industry navigates these challenging times, freshers must focus on enhancing their skills and adaptability to remain competitive in an evolving job market. By focusing on skill development, networking, and staying adaptable, fresh graduates can position themselves effectively in a competitive job market. Additionally, while policymakers and businesses collaborate on initiatives that promote economic recovery and create a conducive environment for fresh hiring to flourish once again, resilience and continuous learning are key to overcoming the present hurdles and building a successful career.

Source: GWFM Research & Study