Standard Chartered India, the largest foreign lender in terms of branches, has decided to reduce 10% of its workforce from the corporate and institutional banking (CIB) division. In India, 40-50 people could be asked to leave as part of this restructuring exercise.
The year 2016 has been witness to many unprecedented events, most of them dampening for business and industry in general, forcing companies to rationalise their workforce.
While the year saw the United Kingdom voting to part ways from the European Union, a phenomenon now famously referred to as ‘Brexit’, Republican nominee Donald Trump’s upset win in the US Presidential election also left many companies’ stocks hammered.
Closer home, the Narendra Modi-led central government’s decision to demonetise Rs 500 and Rs 1,000 currency notes is leading to a spending squeeze and might impact the economy for a quarter or two.
Beside, automation of many services has also made it difficult for companies (especially in the IT industry) to retain their human resource in full. A World Bank report published in October said automation threatened 69% jobs in India.
Business Standard brings the list of some of the major lay-offs in the country in recent months.
1. Standard Chartered
The bank has a total workforce of 500-550 people in the CIB division. “It is likely that about 50 people will be asked to leave but typically, the bank may try and absorb a few people internally in other divisions and so the net impact may be around 40 or so,” reported Business Standard . CIB contributes to the bulk of revenues for the bank. Last year, the bank had said that as part of its restructuring plans to ensure that the lender is profitable, it would be laying off 15,000 people. The total workforce in India stands at around 8,000.
2. Larsen & Toubro
While announcing its financial result for the July-September quarter, engineering giant Larsen & Toubro said it had let go of 14,000 employees in the past 6 months. The company said the step was an attempt to “right size” its strength in the face of a business slowdown. Digitisation of operations also caused redundancies, leading to job cuts. The Economic Times quotes R Shankar Raman, chief financial officer, as saying that the move should not be viewed as a sequential event. L&T has been facing challenges with customers deferring orders and falling oil prices contributing to a sharp slowdown in the Middle-east, one of its biggest bets.
3. L&T Finance Holding
L&T’s non-banking financial services arm, L&T Finance Holdings, in April asked over 550 employees to quit due to high costs and a muted business environment earlier this year.
The day the result of the US Presidential election’s was announced, online marketplace eBay decided to lay off staff at its Bengaluru office and take work back to Silicon Valley. The comapny called this part of its global restructuring exercise, and said it had cut jobs at its centre in Bengaluru in favour of shifting them to other locations around the world. A person familiar with the development said 30% of the Bengaluru development center’s workforce had been cut, according to an earlier Business Standard report. During his election campaign, Donald Trump had chided US technology firms that outsourced work to countries like India and warned he would impose 35% additional tax on such firms.
According to an Indian Express report, Indian IT major Infosys had in August asked about 500 employees to leave over issues of non-performance. This was shortly after a poor show in the April-June quarterly financial result and the cancellation of the company’s contract with Royal Bank of Scotland, where close to 3,000 employees were deployed.
The Indian start-up ecosystem has also been through a hard time, with funding drying up and reports of lay-offs throughout the year. Grofers, an online grocery delivery service laid off 10% of its workforce and revoked 67 campus job offers according to an ET tech report.
Hit by cash crunch, e-commerce company AskMe decided to shut its operations in August, leaving 4,000 staffers jobless. According to sources, most employees at AskMe did not receive their salaries for July, while reimbursements for bills were not cleared for the past many months, reported Business Standard.
Real estate portal CommonFloor laid off more than 150 employees in March. CommonFloor was acquired by online classifieds firm Quikr, which paid a hefty sum of $100 million for the acquisition.