Around 25 to 30 per cent mid-level professionals from Indian apparel manufacturing and export industry are struggling on the job front, as the majority of them have either already lost their jobs or are most likely to lose in the coming days. Apparel manufacturers, mid-level professionals, trade bodies of the industry and placement agencies shared this figure in a survey conducted by Apparel Resources.
When converting this percentage into numbers, it comes down to 50,000 or even more. Let’s dig deeper – 5 billion is the average number of garment pieces exported from India, the production of which requires about 2 million people. If we take 10 per cent as the average strength of mid-management, it comes to around 2,00,000 people, 30 per cent of which is 68,000. We must also highlight here that this is only from export; the number will be the same or even more in the domestic manufacturing sector.
Right from top-level export houses and SMEs to top buying houses and buying agents, everybody has done retrenchment in their companies. While no export house or buying house officially accepted the same, off the record, they shared that there is no other option for them to reduce costs during the ongoing COVID-19 phase.
On the other hand, if one adds the number of apparel retail firms or even vertically integrated companies like Raymond and Blackberrys, the number of laid-off professionals will be even more than 2,00,000. While Blackberrys recently confirmed that it fired 120 employees, its employees shared that more than 200 staff members were asked to quit. Similarly, various media reports claim that Raymond too laid off hundreds of employees. The list of such big companies is long, but most of them have not confirmed the layoffs yet. Unfortunately, this figure may go up if the situation does not improve in the next 3 months.
In a recent interview, Kumar Rajagopalan, CEO, Retailers Association of India (RAI), said that many SMEs in this trade are contemplating the closure of their businesses. In the last week of April, one of the CMAI surveys underlined that around 31 per cent domestic apparel factories may close down soon.
As far as research reports are concerned, the Centre for Monitoring Indian Economy (CMIE), a private think-tank, reported that India’s overall unemployment rate in May rose to 23.48 per cent.
Dr. A. Sakthivel, Chairman, Apparel Export Promotion Council (AEPC) believed that around 15 per cent mid-level professionals of the industry have lost their jobs. At the same time, he maintained that his company Poppys Knitwear, Tirupur, has not fired anyone.
G K Sood, MD, Universal Management Consultants, a well-known placement agency in apparel sector, shared, “Due to layoffs during the pandemic, while there are hardly any new openings available, the number of people seeking jobs is huge. I posted a job vacancy for one person, and received 800 CVs within two days.”
According to Sood, sales and marketing departments are less impacted compared to all other departments, while there is little demand for 3D designers, professionals for virtual showrooms and graphic designers.
Many medium level exporters across India are of the view that they have fixed buyers, so they have reduced merchandisers. Apart from merchandisers and designers, other more vulnerable jobs are in departments like pattern-making, accounts, documentation, compliance, industrial engineering and logistics, etc. Assistants across most of the departments have been removed or reduced.
“We have decided to completely outsource pattern services and have told our senior-most accountant that he has to take care of shipping documentations along with his regular accounting and banking responsibilities,” a Gurugram-based exporter with 150 sewing machines revealed on the request of anonymity. Earlier, the company had four people in its pattern-making team.
It is also pertinent to mention here that most of the small and medium level company owners have begun to get involved in all segments of the business. In fact, few are learning new things in order to reduce the burden.
Exporters strongly suggest that professionals must turn to multi-tasking, as this will help them survive in the long run.
Even worse, it is also being said that many companies are misusing the current crisis by either laying off the staff or imposing more work on them. Rahul Mehta, MD, Creative Garments, Mumbai, presented the other side of the situation, “There is indeed a job risk for around 25 to 30 per cent professionals in our industry, as the majority of these firms don’t have resources to pay salaries.”
There are some other aspects also in this regard, as Aseem Singla, General Secretary, Garment Exporters Association of Rajasthan (GEAR), informed, “As far as Jaipur is concerned, majority of its business is with Japan. And Japanese buyers are most ethical across the globe. So, most of the export units of Jaipur have not fired their staff, but as far as domestic manufacturing in this hub is concerned, there have been major layoffs.”
At the same time, some companies believe that this is not the time to lay off, but to focus more on the team. “I don’t feel that there are layoffs at this scale, as now businesses are demanding more efforts, be it marketing, product development, etc. So, how can one manage with lesser people! Even we have not fired any staff member,” shared Pranab Mahajan, Director, Mahajan Overseas, Panipat – one of the most respected names in the Indian home furnishing industry.
The only ray of hope in this crisis is that companies are keen on utilising the services of freelancers, and that some specific job profiles are a bit more in demand. Also, not all job losses are permanent; some are temporary, as few companies have given breaks to their staff for 3-4 months. Having said that, while such professionals are most likely to return to their previous jobs after few months, they can’t afford to sit idle during this period, and hence, are exploring other jobs to sail through these particular months. Many professionals, who have not been laid off, are working on very low salaries, as they don’t wish or afford to lose their jobs.
Virender Uppal, Chairman, Richa Global Exports, Gurugram, a well-known exporter of India, told Apparel Resources, “There may be 25 to 30 per cent job losses, but it is temporary as whenever the industry will be back on track, jobs will be back too. It may take at least 3 to 5 months. Since one has to survive, there is no other option but to reduce the workforce.” He further added that even his company fired a few people.
As we conclude, it is to be underlined that while the fact that competent employees can’t be replaced and their services will be back in demand once the industry starts picking up in future, several companies, at the moment, are only concerned about handling the current issue which is how to cut cost. And laying off is one of the major tools for achieving that. The times are undoubtedly tough for everyone. And the need of the hour is to not lose hope and work even harder while waiting for things to come back on track.