Services sector led job creation in FY16, says CARE Research

Even as the government has enlarged concentration on original manufacturing through creativities such as Make in India, it was the services sector that exhibited higher jobs growth in FY16. According to the latest research report by Credit Analysis and Research (CARE), sectors including finance, logistics, and IT enabled services (BPO/ITES) testified double digit year-on-year growth in employment. On the other hand, capital goods and infrastructure companies, which are facing a slowdown, reported a drop in workforce.

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A sample of 2,112 companies reported 1.6% growth in the workforce at 5.7 million in the fiscal ended March 2016 from the previous fiscal. “While there is no clear trend in the growth in employment across sectors, the service oriented industries and those in the consumer goods space tended to witness higher growth in employment,” CARE mentioned in its report titled “Employment in the Corporate Sector”.
Over 48% or 1014 companies in the sample failed to report improvement in the employment. Companies in the two-wheelers and passenger car segments showed modest increase of 0.5% and 0.3% in workforce at the aggregate level. The textiles sector, which is one of the largest employers in the country, added just 0.2% more staff in FY16.
Aggregate employment progress for a smaller sample of 728 companies touched a four year high of 2.9% in FY16 after shrinking marginally by 0.4% in the previous year. The compounded annual growth rate (CAGR) for this small sample was 1.5% between FY12 and FY16.

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