The coronavirus pandemic that has swept the globe is perhaps going to be recorded in history as the most impactful and consequential event of this century. It has stretched the capacities of governance, public health infrastructure and social administration of affected nations to their limits. At the same time, the lockdown enforced to prevent the spread has brought economies to the ground and jeopardised the job prospects of many.
With unemployment soaring during these tough times, recent graduates waiting in the wings and looking for their first job feel marooned.
According to the All India Survey of Higher Education by the Ministry of Human Resource Development, India saw 32.9 lakh students graduate from the Arts, Commerce, Science and Humanities streams in 2019. Engineering and MBA graduates accounted for around 16 lakh graduates last year, and the numbers may be expected to be comparable for 2020. In an already bleak job market with growing unemployment rates, a majority of these graduates are likely to find it extremely difficult, if not impossible, to secure employment. COVID-19 has not only altered our ways of life radically in the present, it has also thrown the future of lakhs into question.
Students face uncertainty
“I was eagerly waiting for the placement season and to land my first job. We had been attending special modules geared towards preparing us for job interviews, but now we have no idea if the placement sessions will happen any time soon,” said Sai Lakshmi, a student of commerce in SMS Arts College in Coimbatore. Across the country, graduates such as Lakshmi are anxious about their job prospects. They are fearful of what will be left of their hopes and are bracing for an uncertain future.
Students who had turned down the idea of pursuing a higher education in favour of jobs have also begun regretting their decision. “ It was a toss-up for me between preparing for an MBA and looking for a job. I decided that I would work for a few years before pursuing higher education to shore up my finances and gain experience. But with the current situation, I wish I had opted to study instead, as I don’t know if I will get a job at all,” rues N Srikanth, a final year Mechanical Engineering student in Datta College, Mumbai.
Added worry: Repayment of education loans
For many, the prospect of employment after their education was crucial in their decision to pursue expensive courses. Many took out education loans to complete their studies and pinned hopes on the jobs they would get, to help them repay the loans and ease the financial burden on families.
“I only opted to do an MBA from a good college despite financial issues because of the job prospects it offered. I have an education loan to repay but if I don’t secure a well-paying job it is going to be a huge burden on my family in the years to come,” says Rohith* a final year MBA student at Allianz Business School in Bangalore.
As part of the economic relief measures proposed by the Central Government, a three-month moratorium on the payment of EMIs for term loans, including education loans, is on the cards. But the interest accrued will not be waived. This will result in borrowers paying a higher instalment for repayment or an extension in the loan repayment period.
Rohith* doesn’t find the move very helpful for those like him. “The effect of this crisis on the job market will be long term. The waiver of EMI will help in the short term but the increased amount of money to be repaid or longer repayment period only adds to the difficult situation many like myself are in. Jobs are the need of the hour.”
Colleges and recruiters in limbo
Colleges and universities are also in a limbo about the placement season as there is little clarity on when the lockdown will be lifted. Some colleges such as IIT-Madras have a staggered placement season that takes place in two phases. The first phase was completed in December with the second phase suspended midway due to the lockdown. Shankar Ram C S, the placement advisor of IIT-M says,” We hope to restart the process when the institute can reopen. We will reach out to the companies that have registered with us depending on the climate. We have had one company withdraw their offer so far due to COVID-19, but hope that others will recruit after the lockdown is lifted.”
Not all colleges have had the chance to commence the recruitment process. The placement coordinator of a leading arts college in Chennai said that a majority of the students had been waiting for job interviews before the disruption. “We don’t guarantee 100% placement, but we try to secure our students as many jobs as possible. But with the lockdown we have had quite a few firms back out from the process, as they can’t afford to hire freshers anymore.”
Firms too are caught in stagnation, with their decision on hiring and expanding dictated by the lockdown and its effects. IT services and startups recruitment, in particular, could be affected badly by the crunch caused by the lockdown. Many firms are now mulling freezing salary hikes and promotions and hiring is expected to get slower.
“We don’t have any clarity on whether we can hire freshers as of now. We await decisions that will be carried out across the firm, but from my experience I am certain we will be hiring fewer graduates than before, even when we are able to start the process,” says a HR recruiter of a leading IT services firm who did not wish to be named.
|“Things will definitely be difficult for this graduating class. We expect at least a 10% dip in hiring; also, for those who have been placed, there is a chance that 10%-15% of the companies may rescind or defer the offer.”
— Aditya Mishra, CEO, Ma Foi Solutions
What the coming months could bring
With uncertainty tightening its grip over the job market, the next few months will be crucial in ascertaining how the prospective employers and graduates respond to the changing situation.
A workaround to the crisis has been suggested by the Association of India Universities(AIU), through a few platforms for colleges and companies to overcome the hurdle in hiring. The AIU has partnered with Jeevitam, an MOU partner of the labour ministry to conduct online placements for students during the ongoing crisis. Member universities could register by paying a fee of Rs 10,000 to conduct digital placements for each institute. This speeds up the process and reduces the uncertainty faced by students, colleges and firms.
Ministry of Human Resources has issued a plea to all companies who have recruited so far, to not withdraw their job offers owing to COVID-19. In a meeting held with educational institutions, the MHRD has asked for special placement drives to be held for those who are unable to secure or retain jobs during this time.
The longer term outlook regarding the employment prospects of the current graduates including in terms of salary can only be determined in the next few months. However, all is not bleak, says Mishra, CEO of Ma Foi Solutions. “The graduates who can come out of this reasonably well-placed are those who are willing to look outside the traditional avenues. They could consider contractual employment or commissions and gig work based on their capabilities.” According to him, additional skill sets will prove valuable at this juncture. “Those who can engage in content writing, copy writing, video editing, graphic design or finance-related work could work on those skills and get opportunities in that space.”
|What can students do to beat the gloom in the job market?
(Inputs from Purvi N, a freelance HR consultant)