Retail and real estate

Downward correction of 12%-15%

Experts say there is a massive slump in the retail and real estate business that will see a downward correction of 12%-15% in 2008-09. Vishal Narsian, director, Forsure Placements, Andheri said, "People from this industry are jumping on to others."

Anil Shroff, proprietor, Shroff Estates told Sunday MiD DAY, "With share markets down and people holding on to their money, real estate is suffering. People are under the impression that the markets will crash after Diwali. Construction has also been affected with a decrease in buyers. Builders are trying their best to call broker meetings as a marketing strategy; this is enough proof that this industry is on a major low." There has been no slowdown on housing loan demands, states a Price Waterhouse report on real estate.

Assocham is skeptical. "On an average, real estate is instrumental to the development of 269 other industries and hence, could have an impact on the overall economy as well," its report says.

MBA prospects

'Markets are tight'

A professor from an MBA college who did not want to be named said, "Job security is at an all time low and rumours are damaging people's trust in brands."

Narsian of Forsure Placements said that most MBA colleges still do not provide campus placements and only a few top colleges take such placements seriously. He said, "Most MBA students post their resumes online and wait patiently for companies to respond. Some give up hope and join call centres." 

Sampan Nayak (27), who holds an MBA in finance said, "No knowledge goes waste. However, markets are tight and people are losing jobs, MBA or not. So, if you are not amongst the cream you are out of the race. This is the best time to pursue an MBA as by the time you're done, hopefully the markets are back on their way up."

"With regards to pay packets most MBA students prefer the service industry over the manufacturing sector as the service industry provides better pay," added Nayak.

Information Technology

'Increments affected'

Vijay Mukhi, chairperson, IT committee, SICCI said, "The IT industry was losing people to the retail and aviation industry. MBAs would rather take up finance and other industries. This scenario has changed. The attrition level in the IT industry is down as the industry is more stable than others at the moment.

"However, before IT professionals had three job offers in hand. That will be no more and people will hold on to their jobs more than before. Wage rises will be less and job stability cannot be taken for granted," added Mukhi.
According to the Confederation of Indian Industry (CII), had outsourcing companies (read BPOs) diversified into other businesses earlier, they would have sailed smoothly. "There will not be any job cuts per se. But bench strength (extra people employed in anticipation of bagging international orders), which companies have kept may be reduced. Also increments will be severely affected," said Vikram Tiwathia, chief information officer.

Hospitality

'Hotel room occupancy down 50%'

Dipendra Sachdev, advisor, AHAR said, "Hospitality has been affected in a big way. Our industry is closely linked to the state of society. If the situation is bad, then we will be in trouble, as people would not like to avail our services. At the moment hotel room occupancy has gone down to 50 per cent.

"The worst affected are five-star hotels. This situation is likely to remain for a while. There will be no job cuts, but almost no recruitment. We are predicting that the prices are going to get higher and in that case a lot of restaurants especially the rentals will shut down. Big chains will not make profits but will manage to pull through, while small timers will have nothing to do but to close down."

Joseph Jacob, food and beverages manager, Ramada, Powai said, "Earlier people from the hospitality industry were flocking towards aviation but now, owing to job insecurity, people are either coming back or joining as freshers in the hospitality industry."

Aviation

'Tighten seatbelts'

Indian airlines like Jet Airways have seen a 46 per cent rise in non-fuel costs alone, leave alone the rise in aviation turbine fuel costs. A positive aspect however is that cabin crew can easily adjust to the hospitality and hotel industry. On Saturday evening Kingfisher confirmed that it would have a salary cut for 50 trainee co-pilots. "With a view to tide over the ongoing turbulence in the aviation industry, and keeping in mind the reduction in capacity deployed, Kingfisher Airlines has effected a downward revision in the emolument of a small pool of 50 trainee co-pilots," a company spokesperson said.

"Jet took the extreme step without thought. But cutting costs was essential for the airline, but in a country like India laying off 800 people (at one go) was bound to have the effect seen in the Jet episode," said Marc Martin, senior advisor, aviation global consultancy major KPMG.

Kapil Kaul of the Center for Asia Pacific Aviation (CAPA) said, "A reduction in the sales tax on fuel will help airlines' balance sheets but it won't help them survive. It's perhaps time to stop complaining and to tighten more than just a seatbelt. How they do it remains to be seen."

Pharmaceuticals

'Sector is booming'

With a growth of 13 per cent in 2007-08, industry experts say these are the only two sectors that are still booming despite the recession, because everyone wants medicines and to be healthy.

"Irrespective of whether one is actually sick or not, medicines are always taken to build up health. This sector is actually booming in these times of crisis," said Mario Lobo, chairman and managing director, Personnel Search Services Pvt Ltd. The sector may however not be left out of the slump for too long. "China has knocked India off the catbird seat as pharma's favorite spot for outsourcing," states a Price Waterhouse Coopers Report on the Indian pharmaceutical boom.