Job Hunters Prefer Startup Sector Despite Layoffs Across Sectors

The startup sector remains the top draw for job-hunting candidates despite the turbulent last few quarters. High pay packages, stock options, and quick career moves remain the top factors for candidates to enter a sector that this year has laid off more than 17,000 employees.

Despite the mass layoffs, startups remain a preferred choice for employees, as 79% prefer to work with them,” said a Mint + Shine Talent Insights report which gathered responses from 820 senior HR executives, across sectors.

The study for the October to December quarter shows that executives prefer the flatter hierarchy and quick decision-making in the new age firms. About 39% of respondents will work for a startup due to the learning opportunities it provides.

“Since founders -and employees often work together, the flow of information, ideas, and response to the crisis is quicker than in large organisation,” said the study. 

About 22% opted for “high-paced career progression” and 20% of respondents want to work with startups since they provide better compensation plans to employees compared to corporates. 

Recruiters too have noted that despite fund crunches and a global recession, the IT, IT enabled Services (ITeS) and startups remain preferred industries. 

“The kind of mass scale hiring that IT does, it remains an important sector for the junior and middle management. Startups too are recruiting engineers in a large scale and when the expected tenure is barely two years, the layoffs don’t concern many,” said Aditya Narayan Mishra, chief executive at Ciel HR Services.

Over the last two quarters, the big tech firms have announced layoffs and hiring freeze. The big tech firms’ job openings in India are also down by nearly 90% of their typical hiring volumes, making startups a viable option for software developers, coders and AI and machine learning experts. 

However, despite layoffs, the market is predicted to be favourable for Indian job seekers during the first quarter of 2023, as 7 out 10 IT companies in India want to increase their headcount during this period,” said the study. 

“Breaking the archaic market trends, startups, today have not only emerged as a new destination for job opportunities for candidates but also are contributing to new skills development akin to corporate houses,” said Akhil Gupta, CEO Shine.com

Tenure of a job also came into focus as the days of Great Resignation seem to be over. However, most don’t want to remain with a company on a long term basis. 

“50% of respondents prefer to continue for an organization for 2-5 years compared to 22% of respondents who want to change within the first 2 years of their career,” said the study. 

Although the number of offers and opportunities may have dwindled, 82% of the Indian workforce intended to switch jobs by the end of 2022. Most of them belong to the younger age bracket of freshers or Gen Z.

Companies like Larsen and Toubro (L&T) say they have multi-pronged ways to retain talent.