With exports contracting consistently, sectors such as leather, automobiles and gems and jewellery have begun to shift their hiring away from export-oriented units and boost employment in other areas. The textiles and metals sectors, however, are still increasing employment in their exporting units, though export growth has been rapidly decelerating.
The data released this week by the Labour Bureau for the quarter ended March 2015 show the textiles sector, including apparels, added 1.6 lakh employees to its exporting units in the quarter. To put it in perspective, textile exports grew by 17 per cent in the March quarter of 2014 and the sector added 1.9 lakh employees to its exporting units during those three months. In the quarter ended March 2015, the sector added 1.6 lakh export-oriented employees, though export growth slumped to just 0.2 per cent.
Textiles
QuarterEmployment change (y-o-y, thousands)Export growth (y-o-y, %)
2014-03-0119717.0
2014-06-0116411.9
2014-09-011649.9
2014-12-01842.9
2015-03-011570.2
One possible explanation offered by experts is that the industry is gearing up for the Christmas shopping season in the U.S. The data do not support this. The sector has been adding more or less the same number of employees to its export segment, regardless of the season.
The metals sector is following a similar trend. It actually reduced its export-oriented employment in the quarter ended June 2014 by 11,000 employees, though exports grew 22 per cent.
The data do not support this. The sector has been adding more or less the same number of employees to its export segment, regardless of the season.
The metals sector is following a similar trend. It actually reduced its export-oriented employment in the quarter ended June 2014 by 11,000 employees, though exports grew 22 per cent. In the quarter ended March 2015, exports grew at a much slower 15 per cent; yet it added 39,000 employees to its workforce in exporting units. This trend of slowing export growth but increasing export-oriented employment is apparent in the previous two quarters too.
Metals
QuarterEmployment change (y-o-y, thousands)Export growth (y-o-y, %)
2014-03-01-19-2.1
2014-06-01-1122.3
2014-09-01-628.2
2014-12-01424.5
2015-03-013915.0
Other industries are following a more predictable path. The leather, automobiles and gems and jewellery sectors have either reduced the additions to the export-oriented workforce or downsized it. Instead, most of these sectors are favouring their non-exporting units.
The leather sector, for example, laid off 14,000 export-oriented employees in the quarter ended March 2015. This follows the retrenchment of 7,000 employees in the previous quarter. In comparison, the sector reduced just 4,000 people from its non-exporting units in the quarters ended December and March combined.
Leather
QuarterEmployment change (y-o-y, thousands)Export growth (y-o-y, %)
2014-03-013918.6
2014-06-012921.1
2014-09-01715.6
2014-12-01-72.9
2015-03-01-14-6.2
The automobiles sector added just 7,000 employees to its exporting units in the six months ending March 2015. It added 44,000 employees to its non-exporting units in the same period.
The gems and jewellery sector had added an average of 12,000 export-oriented employees every quarter until December 2014. But it added just 1,000 workers between then and March 2015.
Overall, the sectors selected by the Labour Bureau added a total of 2.6 lakh employees to their non-export units and 2.7 lakh employees to their exporting units.