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Stimulus packages generated 20% new jobs: ASSOCHAM

India Infoline News Service | Mumbai | February 22, 2010 14:18 IST

The APP Study titled “Impact of fiscal stimulus in Job Creation”, revealed that when the global financial crisis hit the Indian shore in October 2008 and manufacturing sector was majorly impacted due to the decline in export orders, the domestic employment situation deteriorated sharply

The stimulus packages offered, has significantly turned around the job creation activity of India Inc. by fuelling a growth of 19 per cent in employment generation during the October – January period of this fiscal over the corresponding period of last year, according to ASSOCHAM Placement Pattern (APP) Study.

The APP Study titled “Impact of fiscal stimulus in Job Creation”, revealed that when the global financial crisis hit the Indian shore in October 2008 and manufacturing sector was majorly impacted due to the decline in export orders, the domestic employment situation deteriorated sharply. However, a year later, there is a significant turnaround in new job creation accruing to the fruits of stimulus.

The three installment stimulus package offered an immediate opportunity to the beneficiary industrial sectors and many industries have taken advantage not only in growth in profitability but also in terms of job creation. The strong pickup in domestic industrial production and improving export orders have led to acceleration in the job creation process.

Average growth in IIP, Exports & Employment generation (October – January)

Economic Indicator

Y-o-Y growth (in %)

IIP# 

12.9

Export 

8.1

Employment 

18.8

Source: Ministry of Commerce & Industry, ASSOCHAM Placement Pattern # corresponds to October – December

Dr. Swati Piramal, ASSOCHAM President said that out of 32 sectors analyzed by the Study, some sectors registered robust recovery like academics, advertising and IT hardware while others like logistics, printing & packaging and energy sector lagged behind with very slow pace in jobs creation.

Top five sectors which recorded major Growth/Decline in job creation
(During October-January 2009-10 as compared to October-January 2008-09)

Sector 

Growth in % 

Sector 

Decline in %

Academics 

137 

Logistics 

33

Advertising/Event Management

111 

Printing & Packaging 

28

IT/Hardware 

105 

Biotechnology/Pharmaceuticals 

22

Research & Consultancy 

65 

Construction 

12

Engineering 

63 

Energy 

10

Source: ASSOCHAM

The stimulus provided by the other countries and international institutions, boosted the international trade, which also increased the export/import activities in India and created jobs in manufacturing and merchandising sectors. The sectors recorded 60 per cent and 38 per cent growth in job creation respectively during October – January 2009-10 over the period when the crisis was at its peak.

Among the major services sector, job creation in the academics and advertising/event management sectors more than doubled whereas research & consultancy services sector recorded 65 per cent growth in employment generation during October-January 2009-10 as compared to the same period of last year.

The automobile industry has shown an impressive recovery in demand and job creation due to the stimulus package provided by the government in the form of excise duty cuts and easy liquidity. The sector registered 24 per cent growth in job creation during October-January 2009-10 over the same period of last year.

The hospitality sector including aviation, hotels & restaurants and tourism, according to the ASSOCHAM study, registered 19 per cent growth in job creation during the October-January period while helped by the growing infrastructure development projects, the infrastructure sector registered 40 per cent growth in job creation during the period over the corresponding period of last year when the crisis was at its peak.

In the analysis of BFSI sectors financial services and insurance sector recorded 27 per cent and 19 per cent growth in job creation respectively during the October-January 2009-10 over the same period of last year whereas banking sector registered 7 per cent decline in job creation during the same period.

The growing demand of engineering goods and computer hardware boosted the employment opportunities with the sectors recording 63 per cent and 105 per cent growth in job creation respectively during the October – January 2009-10 over the same period of last fiscal. Other sectors which recorded growth in job generation during October-January period were telecom (45 per cent), gems & jewellery (7 per cent), retail (6 per cent), warehousing (3 per cent) and media & entertainment (1 per cent). On the other hand, agriculture, FMCG, IT/ITeS, HR and textile sectors recorded marginal decline in job creation during the analyzed period.

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113100802838
Stimulus packages generated 20% new jobs: ASSOCHAM
Stimulus packages generated 20% new jobs: ASSOCHAM
The APP Study titled “Impact of fiscal stimulus in Job Creation”, revealed that when the global financial crisis hit the Indian shore in October 2008 and manufacturing sector was majorly impacted due to the decline in export orders, the domestic employment situation deteriorated sharply
http://www.indiainfoline.com/article/news-business/stimulus-packages-generated-20-new-jobs-assocham-113100802838_1.html
February 22, 2010 14:18 IST
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