Furious Govt slams Assocham for job loss report

Bangalore: The job loss scare kicked up by industry group Assocham has got the Government fuming. It has termed as baseless and outrageous the chamber's suggestion that one in four workers in a variety of industries will be laid off over the next 10 days.

Nervous employees, already worried over the impact of economic slowdown, woke up on Thursday to newspaper reports that cited Assocham as saying 25-30 per cent of jobs in seven sectors – aviation, steel, cement, construction, real estate, IT-enabled services and financial sector – will be lost in the post-Diwali period.

“This is completely outrageous,” a visibly upset Minister of State for Power and Commerce Jairam Ramesh told reporters at a technology meet in Bangalore. He said industry bodies should be more careful before putting out such 'scary and sensational headline-grabbing news.'

He said authorities are trying to resolve the industry's concern over a cash crunch, by reducing interest rates and pumping in money into the financial system. At this point, a report like this will have a negative impact, he added.

Supporting his view, Planning Commission Deputy Chairman Montek Singh Ahluwalia said all that might happen is a fall in the number of new jobs created in the country from, say, one million to 7,50,000 or so next year. But it is wrong to say a quarter of all existing jobs will be lost.

Industry experts agreed with the Government and called the Assocham report an exaggeration.

Co-chairman of Infosys Technologies, Nandan Nilekan, said software companies had already put out projections of slowing growth, but job losses in that proportion are not likely.

“We are close to the market and the customers. It is a grossly exaggerated figure,” Chief Executive Officer, Human Resources, Ma Fai Management Consultants, E Balaji, told Network18 from Chennai.

Some sectors that have excess labour or face demand slowdown will prune their workforce, but it will be in a smaller proportion, Balaji said.

Many might just ask the low performers – the bottom five per cent or 10 per cent – to go, he said.

(Mitu Jayashankar is Associate Editor at the new business magazine to be launched by Network18 in alliance with Forbes, USA)