Frontline workers' supply outstrips demand

MUMBAI: After a prolonged shortage, the supply for frontline blue-collar workers in fast moving consumer goods (FMCG), ecommerce and logistics has outstripped demand in January.According to an estimate by Teamlease Services, shared exclusively with ET, the supply of workers in these sectors has risen from a shortfall of 25-30% in June — when the unlock phase began — to an excess supply or availability of nearly 5% in January.The talent landscape of the survey includes skilled, semi-skilled and unskilled workers — all of whom however have the experience of working in some job role in a specific industry.The excess supply of workers in these sectors (which are recovering faster than the others) indicates the lack of employment for migrant workers — many of whom are not getting their previous jobs. Despite sector level recovery there are not enough jobs to match the skills, said experts.“This is perhaps an indication that jobs recovery in these sectors which are also the otherwise fastest growing is still not happening at the pace at which people are coming back,” said Rituparna Chakraborty, executive vice president, Teamlease Services.“There are probably not sufficient jobs for the people who have experience which could be one of the reasons for supply being in excess,” she said, adding that it could also be due to a time lag as many people who had gone back to their native places during the lockdown period have returned but are yet to find a suitable job matching their skills.80601665Demand % indicates proportion of employers with intent to hire. Supply % indicates relative supply of labour normalised based on intent to hire > Key ProfilesDelivery executive, mechanical/electrical technician, printing operator, service technician, elevator installers and repairer, dispatcher, steel worker, structural iron worker, shop helper, and cab driversSource: Teamlease ServicesIn certain sectors such as ecommerce and logistics, for instance, demand for frontline labour jumped during the lockdown and continued for some months after the unlocking, but then started to flatten or decline.TN Hari, head of HR at online grocer Big Basket, said: “We saw a sharp spike in demand during the lockdown and the higher demand continued for several months into the pandemic. However, the demand flattened as India witnessed a reverse migration of people from Tier 1 to Tier 2/3 cities because of large-scale work from home. As a result, the demand for frontline workers has also been flat or has seen a marginal decline from the peak.”Such a scenario of excess supply and less demand in the skilled (experienced) labour sector usually does not happen in India. “In normal scenarios, most employers say they are not finding enough skilled people for the job on account of skill mismatch,” said Chakraborty.Madan Sabnavis, chief economist at Care Ratings, said: “The supply has increased relative to demand for a couple of reasons. First, there would have been some technology substitution in these industries (FMCG, logistics and ecommerce) when the migrants left. Also, migrants from other sectors would have made themselves available for these sectors, considering that they are the ones which are doing well now and have also managed to stay afloat during the pandemic.”Elsewhere, sectors like construction and real estate, manufacturing and healthcare and pharmaceuticals still continue to face worker shortage — albeit at a much lower scale than a few months ago.In June 2020 (when companies started resuming operations post lockdown), these sectors experienced a worker shortfall of nearly 50% (triggered by the mass exodus of migrant labourers) — which has come down to 5-8% in January 2021, according to Teamlease data.Despite the excess supply in some sectors, many of these skills are not fungible. For instance, a delivery boy may not be easily able to get a job in a construction site or a skilled auto shop floor worker may not be required in an FMCG shop floor. It is also linked to the geographical location of a job as well as willingness and proficiency to switch to a totally different job.A combination of reasons is leading to the shortfall.In construction and real estate, for instance, several of the businesses like small and a few medium sized ones are still in a wait and watch mode. The labour shortfall in construction, real estate, manufacturing and pharma has marked up the salaries in these sectors by 7-10%.

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