Article: These are the jobs shifts in the ecommerce sector


These are the jobs shifts in the ecommerce sector

Ecommerce Sector steered optimistic with a 14% rise in the formal workforce in the last 3 years; Flexi staffing is in for a critical role-play to boost opportunities in the e-commerce upcoming job market.
These are the jobs shifts in the ecommerce sector

The Indian E-commerce industry has been on an upward growth trajectory and is expected to surpass the US to become the second-largest e-commerce market in the world by 2034. The E-commerce market is expected to reach US$ 200 billion by 2026 from US$ 38.5 billion in 2017. This growth is primarily attributed to rising income, the surge in internet penetration, and a rise in smartphone sales. Although on the global e-commerce readiness index, India is at 10%, and ranks behind countries such as Brazil (20%), China (30%) and Russia, with appropriate demand drivers in place, its maturity can match that of China and Russia in next 5-6 years. With the perfect combination of a Make-In-India’ solution approach and favorable policy environment, India’s e-commerce story can reach a globally leading compounded annualized growth rate of 35%. 

Already, on the job front, from 2015-18, reforms like GST & demonization has ushered in the highest informal to formal shift of 14% in E-commerce sector when compared to others like Manufacturing (11%), Government(10%) and Education (7%) respectively (Source: ISF Annual 2019 Report). Currently pegged at $35 Bn, it can potentially create more than 1 million jobs by 2023. (Source: PWC and NASSCOM). 

The E-Commerce industry has transformed the way business happens in India. E-tail and e-travel are two dominant sectors in the e-commerce marketplace model, while omnichannel and inventory-led models are also making inroads. With growing internet penetration, internet users in India are expected to increase from 445.96 million in 2017 to 829 million by 2021. As of September 2018, internet subscribers in India stood at 560.01 million people. This surge in internet penetration is creating a fertile land for sustained e-commerce growth. 

Impact of reforms 

Govt. declared constructive initiatives like Digital India, Make in India, Start-up India, Skill India and Innovation Fund along with its decision to allow 100% FDI in online retail of goods and services under the “marketplace model” to legitimize India’s existing e-commerce business structure has already reared positive growth in this area. ISF’s Impact of Key Reforms on Job formalization and Indian Flexi Staffing Industry 2019 Report findings mentions that E-commerce sector topped the chart, with a 14% increase in the formal workforce share i.e. 77% to 91% from 2015-2018 and a penetration of 11.9%, the second-largest, after IT/ITES sector. In the future, the Flexi workforce growth (CAGR) of the e-commerce sector will rise from 44% (2015-18) to 54% (2018-21) said the ISF report.

Flexi staffing which holds a substantial portion of e-commerce employee base has the highest boost during the festive season, falling in the second half of the year when the demand for temporary staff soars. To meet the sudden consumer demands arising out of the sale period, the e-commerce giants resort to in time hiring during which staffing firms see a positive outlook and expect a 10%-15% jump in temporary hiring. There is aggressive hiring expected ahead of the festive season in 6 months for job roles like Delivery Personnel and Support functions, Supply chain and Logistics Operations in addition to junior level delivery and client relations staff and mid-management level personnel in finance, operations, and digital selling. Roles would be in supervising operations, sorting centers, packaging and managerial roles in delivery stations, delivery associates in charge of hubs and delivery executives. 

Emerging trends and festive season

Tier-II and III cities become the biggest consumption market for e-commerce companies during festive season considering the large customer base. Diwali festive sales showed a 40% contribution from tier II and III cities. Certainly, the job market in these cities is proliferating and is expected a growth of 15%. Ecommerce giants today have started focusing on building operation and support team in smaller markets to capture the next 300 Mn user market. Foodtech companies are leading this through its strategy of hyperlocal. Non-metro (rest of India) cities grew 7x faster q-o-q compared to metro cities (80% growth vs 12%). 

Seasonality of business is driving the segment’s high growth, witnessed prominently during festive seasons when Flexi workforce is in high demand to meet the delivery schedules effortlessly and min. 40% more Flexi hiring will happen in 2019. The challenge of immediate workforce supply during the high sale period and rising attrition rate in the 24x7 e-commerce business can be both resolved with Flexi staffing model. As e-commerce players and startups ramp up hiring for tech and supply chain experts and relook at strengthening and scaling up their business backbone, Flexi staffing will have a critical role-play. Salaries for e-commerce workforce are already spiking due to high demand and short talent supply and in some cases, their wages surpass that of an entry-level engineer. 

India has geared up for becoming a $5 Trillion economy with a better ecosystem of connectivity, logistics, internet infrastructure, and rising income levels. E-commerce sector is bound to be one of the biggest beneficiaries and contributor to the growth and needless to say flexi staffing shall keep on supporting this e-commerce growth by fulfilling the manpower demand.

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Topics: Recruitment, Talent Management, #Work & Skills, #Jobs

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