The first quarter of the new financial year saw a reduction of average payroll size by nearly 26 per cent across industries. This reduction is attributed to two accounts. Firstly, due to reduced headcount in entry-level jobs and secondly Due to the reduction in salary payout per employee in the middle-senior roles.
As per the latest report by PeopleStrong, as the country opens up, the downsizing continued. Most industries witnessed headcount reduction with Hospitality/QSR & Infra/Real Estate sectors witnessing a 34 per cent and 20 per cent reduction in headcount in the last quarter itself. The total salary bill also continued to take a hit but the average salary per employee has risen owing to a reduction in headcount.
The second quarter of the financial year also saw a massive jump in FNF (Full ‘n’ Final) processing across industries reflecting a shift towards the gig workforce. More organisations are now opening up to working with people on contracts for projects and deliverables. This trend has also fueled hiring from Tier 2 & Tier 3 cities where candidates are ready to work on a reduced CTC.
Vikas Sapra (VP, Payroll, PeopleStrong) said, “We are now witnessing a return of healthy activity on the hiring front, it is not at a pre-Covid level yet, however is net positive. Also, employee’s salary which was reduced in the first quarter is now being reinstated. This points towards recovery, and if we do not see a spike in Covid-19 cases in the coming months then we can hope for a faster turnaround.”
The report also highlighted different reimbursements such as travel, lodging and fuel. The reimbursements have naturally dropped by 65-70 per cent. But other segments that have witnessed a huge jump in the number of claims include professional advancements, pursuit allowance, and professional development.