Jobs generation gets a boost as India Inc unfazed by slowdown, says CII

March 29, 2013

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Unperturbed by the global economic and political uncertainty, India Inc continues to believe in the India story as there is an expectation among a significant number of firms of improvement in employment opportunities in the fourth quarter of this fiscal.

Despite the sluggish economy, the Business Outlook Survey by industry chamber Confederation of Indian Industry (CII) for January-March 2013 revealed that 51% of the firms expect no change in their employment levels while 22.4% expect it to decline. More than 30% of the firms saw a fall in their staff levels in October-December 2012.

“However, expectations have improved as 23.5% foresee an increase in their employment levels in the fourth quarter compared with 11.7 % in the third quarter,” CII said. The report showed that in the third quarter of 2012-13, 58.3% of the respondent firms kept their staff levels unchanged as opposed to 30.1%, which saw a fall in their employment levels.

However, high levels of corruption, persisting inflation, threat to continuation of reform process, escalated interest rates and political uncertainty remain the major concerns.

Despite the GDP growth falling to 4.5% in the October-December period of the current fiscal compared with 6% in the same period of last fiscal, the CII survey indicated that 43.5 % of the respondents expect the Indian economy to expand by 5-5.5% for 2012-13. On the inflation front, 42 % of respondents expect average WPI inflation to lie in a range of 7-8.0 % in 2012-13. For 2013-14, however, 37.4 % respondents hope inflation to moderate and come down in to 6-7 %.

As for the current account deficit too, the CII said most of the respondents expect it to lie in a range of 4-5% of GDP in both current as well as next fiscal. Considering all these aspects and reflecting the recent reform steps initiated by the government, the CII Business Confidence Index, which had slipped below the psychological 50 level mark in the third quarter of the current fiscal, rose to 51.3 in the final quarter.

“Though the index has strengthened in the final quarter of the current fiscal, it is too early to assume that the slowdown has bottomed out and the green shoots of recovery have begun to emerge,” said CII director general Chandrajit Banerjee.

Source-http://www.indianexpress.com