The telecom sector is witnessing a spree of mergers and consolidation. This realignment might affect jobs. The industry might shed weight by reducing the workforce, believe the experts. According to a report tabled by GSMA, the country’s telecom sector presently has more than 2 million direct employees and more than 1.5 million indirect employees. The telecom sector once wooed some of the best resources of the country. In the last few years, the spending pattern of the consumers changed as the demand for data soared which further forced telecom giants toward consolidation.
Rajan Mathews, director general of Cellular Operators Association of India, while speaking to a leading business daily, raised his concern about the financial health of the telecom sector. He said, “We are very concerned about the financial health of the industry, which cannot sustain jobs if the sector does not grow in an orderly manner. With many companies exiting (Telenor, MTS, Videocon) the sector and country, we are looking at shedding 30 percent jobs in the near future.”
The trend is visible in various stakeholders of the sector. Bharti Airtel’s employee base has witnessed a sharp dip. In the third quarter, the employee base of the company slipped to 19,048, from 19,462. The company has also reduced the employee cost to 2.5 percent from 5.3 percent. Experts think that as many of the telecom majors are joining hands to stay afloat in the market, it is actually reducing the competition in the market significantly.
Apart from the direct jobs several indirect jobs created through distributor networks, franchise, call centres, retail stores and even the network maintenance companies might also get hit by this new emerging trend. Some of the mega-mergers in the telecom sector will now create a cloning of manpower and this will push the telecom biggies towards manpower resizing. Industry analysts are expecting that within next 12-18 months the merged entity will axe more than 35 percent of its employees. – India Infoline