Amidst the ever-changing landscape of 2023, the Indian startup ecosystem experienced significant upheaval and evolution. Startups were actively involved in integrating new technologies, adjusting to updated regulations, and innovating their business strategies to stay efficient and competitive. Faced with these hurdles, companies displayed strategic agility by cutting costs and reallocating resources to key business areas. Simultaneously, many firms strategically bolstered their teams through focused hiring, showcasing resilience in the face of adversity.
The shifting industry dynamics and workforce strategies are revealed through the sectoral movements observed by RazorpayX Payroll, the business banking platform of Razorpay. Analysing payroll data from April to December 2023, encompassing over 30,000 employees across 20+ sectors, the platform sheds light on notable transformations within the organisational landscape. Insights include the rising adoption of outsourcing firms, alterations in salary distributions and hiring patterns, as well as department-wise demand trends over the past nine months.
Key insights include:
- Rising demand for outsourcing firms
Amidst a slowdown in full-time hiring, the need for outsourcing companies surged, with a 26.77% increase in inflow. This trend spans various departments, including technology, sales & marketing, and logistics & operations, indicating startups' pivot towards specialised outsourcing firms. However, individual contract workers saw only a marginal 0.22% salary uptick, contrasting with the broader outsourcing trend.
- Incremental growth: Full-time female employees' salaries
Over the past 9 months, total salary disbursed has grown by 8.22%, with full-timers seeing a 6.69% uptick in average salary. Notably, female employees experienced a 9.13% increase compared to 8.87% for males, showcasing progress towards workplace gender pay equity.
- Shift in recruitment trends: Full-time and CXO hires on the decline
Over the observed period, full-time employee hiring dropped by 17.23%, with CXO hires experiencing a steeper decline of 25%. Additionally, recruitment for senior executive roles saw a notable decrease of 37.63%, indicating shifting dynamics in hiring practices.
- Strategic focus: Surge in full-time hiring in key departments
Despite an overall decrease in full-time hiring, departments like sales & marketing and finance experienced notable growth of 23.24% and 21.45% respectively. This strategic shift underscores companies' emphasis on reinforcing vital areas for growth and financial resilience.
- Financial and HR sectors lead salary growth trends
In a notable trend, salaries for full-time employees in finance and human resources departments surged by 11.06% and 8.90% respectively, surpassing the overall sector growth rate of 7.03%.
Commenting on the trends observed, Ayush Bansal, VP & General Manager, RazorpayX said, “The Indian sīarīup ecosysīem conīinues īo lead in īechnological disrupīions, seīīing new benchmarks despiīe economic challenges. The daīa from īhe RazorpayX Payroll plaīform reﬂecīs a growing inclinaīion among sīarīups and enīerprises īowards ouīsourcing services. This sīraīegic shifī aims aī enhancing efﬁciency, fosīering a balanced approach īo effecīive capiīal uīilizaīion, and paving īhe way for fuīure building blocks of īhe company īhrough innovaīion. While challenges are apparenī wiīh īhe decline in CXO hiring, īhe indusīry's commiīmenī īo fosīering a workplace īhaī values diversiīy is evidenī.
The growīh in salaries especially for women employees, despiīe a hiring slump, highlighīs īhe indusīry’s commiīmenī īo building a workplace īhaī values diversiīy and recognizes īhe conīribuīions of all iīs members. Togeīher, īhese īrends usher in a new era of work culīure marked by specialized īalenī, a more dynamic, collaboraīive approach īo driving innovaīion, and a sīeadfasī commiīmenī īo gender pay pariīy,” Bansal added.