In the wake of the post-pandemic economic resurgence that resulted in the creation of 8 million new frontline jobs in FY22, India experienced a 17.5 percent decline in the generation of such employment opportunities, bringing the number down to 6.6 million in FY23. This decline can be attributed to the prevailing macroeconomic challenges, as per a recent study conducted by the blue-collar workforce management platform, BetterPlace.

Frontline jobs, spanning sectors like e-commerce, logistics, and mobility, have traditionally served as indicators of the external economic landscape. Analyzing data collected between April 2022 and March 2023, BetterPlace's Frontline Index Report, released on Monday, highlights a year-on-year decrease of 17.5 percent in the creation of new jobs.

This phenomenon coincides with India's struggle to witness a complete recovery in rural consumption following the pandemic. Additionally, persistent concerns of a potential recession in the United States continue to cast a shadow over the IT services industry, subsequently impacting the spending patterns of white-collar employees in India.

For instance, the report reveals that demand within the e-commerce sector plummeted by 52 percent in the previous year, despite it remaining the second-largest employer of frontline workers, accounting for 33 percent of all such jobs. In FY23, 'Logistics & Mobility' has overtaken e-commerce as the leading industry in terms of employing frontline workers, with a remarkable increase of more than 111 percent in demand over the past fiscal year. The Information Technology, Financial Services, and IT-enabled Services (IFM&IT) industry experienced the most substantial growth in demand for frontline jobs, registering a staggering 139 percent surge between FY22 and FY23.

Pravin Agarwala, Co-founder and Group CEO at BetterPlace, attributed this decline in demand for frontline workers to the prevailing macroeconomic challenges. He noted a trend called 'The Great Variabilization Trend,' where enterprises, in their efforts to cut costs, are transitioning from fixed employees to task-based workers. This shift has led to the rise of gig work, enabling enterprises to better adapt to variable demand and manage operational costs. Consequently, gig work is becoming the new norm in sectors where it was less prevalent in the past.

Agarwala also highlighted that the increasing gig-ification of the workforce has led to a higher participation rate of women. Furthermore, in line with the decline in demand, the average monthly salaries for frontline workers saw a marginal decrease of 4.5 percent to Rs 21,700 in FY23. However, the IFM&IT sector not only recorded the highest average monthly salaries at Rs 25,700 but also witnessed a 17 percent salary increase compared to FY22. This sector was closely followed by the Banking, Financial Services, and Insurance (BFSI) and Logistics & Mobility sectors, offering average monthly salaries of Rs 22,000 and Rs 21,800, respectively. Notably, despite being the sector with the highest demand for frontline workers, Logistics and Mobility experienced an 18 percent decline in average monthly salaries.

In terms of gender diversity, there has been an improvement, with the participation ratio of women increasing from 3 percent to 6 percent between FY22 and FY23. Although the demand for female frontline workers in the e-commerce sector increased by nearly 36 percent compared to FY22, it's essential to acknowledge that the overall participation of women in the frontline workforce remains relatively low.

Agarwala commented, "Only 6 percent of the entire frontline workforce cohort, according to our platform data, comprises women. This figure is considerably low when considering that the total frontline workforce cohort numbers 250 million. Despite notable efforts by enterprises, we still have a long way to go in achieving gender diversity."

The report also revealed that Karnataka has replaced Maharashtra as the largest contributor of frontline workers in FY23, constituting 16 percent of the total workforce. However, 62 percent of the migratory frontline workforce sought employment in Maharashtra, Karnataka, Haryana, and Tamil Nadu. The average monthly attrition rate for frontline workers in FY23 was 15 percent, with peaks reaching 23 percent in November, following the festive season.

With reduced intent to hire, enterprises are focusing on upskilling their existing workforce to take on more significant roles. The report underscores that the time spent on learning increased by over 165 percent between April 2022 and March 2023.