According to its latest annual reports, the reduction was entirely led by five retailers: Reliance Industries‘ retail arm, Titan, RaymondPage and Spencers, which saw their combined workforce decline by 17% or 52,000 people. The headcount was done across permanent and contractual employees and adjusted for attrition in the retail segment, the second-largest employer after agriculture. These retailers had a combined workforce of 429,000 people in FY24 compared with 455,000 employees a year ago.
“There is a talent shortage and we are trying to join forces with universities so that the industry has the option to hire. Some companies may have reduced staff due to the closure of some businesses, but companies like Buyers stop and Trento “The sector will continue to expand and will require manpower,” said Kumar Rajagopalan, chief executive of the Retailers Association of India, which represents organized retailers in the country.
Consumers had started cutting back on non-essential spending such as clothing, lifestyle products, electronics and dining out from Diwali 2022 due to inflationrising interest rates, job losses in sectors such as startups and information technology, and an overall slowdown in the economy. India’s retail sales expansion slowed to 4% last year after a surge in spending across all segments from apparel to automobiles in the post-pandemic period, triggered by revenge shopping.
RIL in its annual report said overall voluntary separations in FY24 were lower than in FY23 and the retail industry generally has a high employee turnover rate, especially in store operations.
“Store productivity often comes in cycles and we have seen consumers unleash their spending post-pandemic, prompting retailers to expand their network or square footage. However, if some of the stores are not viable, management teams are now very targeted, even ruthless, and will shut down the stores,” said Devangshu Dutta, founder of retail consultancy Third Eyesight. “Also, any company planning to go public would want to have healthy and efficient operations, though we cannot single out Reliance in this case.”
Weak sales meant these retailers had the slowest pace of store expansion in at least five years, at 9%. The retail sector occupied 7.1 million square feet of space in the eight major cities in 2023, a figure that is expected to fall to 6-6.5 million square feet in 2024, according to commercial real estate services firm CBRE.
“There’s a huge need for bandwidth management to get this whole ship running on the right trajectory, in the right direction, and at the right speed. We’re thinking about what this company is going to look like in 10 years. And so, if we want to get there in a nice way without too much damage and bruising, then what kind of talent do we need to have today, in the next 2 or 3 years?” Avenue Supermarkets CEO and Managing Director Neville Noronha asked investors.
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