Global hiring front of mind to plug skills gap
Deel, the all-in-one payroll and HR platform for global teams, today released the first edition of its annual market research, "India Business Leader Pulse Check: Workforce and Hiring". The research, conducted by Rakuten Insights between June and July 2024, surveyed the sentiments of business decision-makers, from small, medium, and large enterprises, across various industries. The topics include talent attraction and retention, global team management challenges, AI usage in their businesses, and the evolving work and hiring landscape in India.
The research results show that India's businesses are at a critical juncture in their AI talent journey, facing high salary expectations and stiff competition for top talent. Despite having one of the fastest-growing AI talent pools in the world, the ongoing AI skills ratio between demand and supply of AI talent stands at 51% in India, with higher demand-supply disparity for roles such as machine learning engineers, data scientists, DevOps engineers, and data architects. Our research shows that India's organizations are open to hiring from other markets (88%), which can help to fill the AI sector skills gap now and allow skills transfer from global teams to the next generation of AI employees in India," says Mark Samlal, General Manager for the Asia-Pacific region at Deel.
Findings from Deel's 2024 India Business Leader Pulse Check: Workforce and Hiring
The struggle to find AI talent
High salary expectations amongst AI professionals present a significant barrier when trying to hire talent, especially for those hiring exclusively within India (80%). Fierce competition from other firms vying for the same skilled professionals also adds to the hiring challenge in India. Accurately assessing candidates' AI capabilities is another key difficulty, while integrating this specialized talent into an existing workforce culture is also posing problems. These findings highlight the need for organizations to develop more effective strategies for identifying, evaluating, and retaining AI professionals to stay competitive in today's rapidly evolving business landscape.
High salary expectations is a major difficulty in hiring AI talent (66%), particularly for companies hiring within India only (80%)56% of respondents cite fierce competition from other companies as a significant challenge in attracting AI talent55% of respondents struggle to accurately evaluate candidates' AI capabilities52% of respondents find it challenging to integrate AI talent into their existing workforce culture50% of respondents attribute their difficulty in recruiting AI talent in India to a lack of qualified candidates in the local job market
Business operations and appetite for global hiring
Indian organizations are increasingly recognizing the benefits of hiring talent outside of India. 88% of organizations are open to global hiring, with that rising to 96% among C-suite roles, 98% amongst seed/start-up businesses, and 99% amongst respondents between the ages of 18 to 34. Key benefits of hiring talent outside India include access to a wider talent pool and the ability to expand into new markets.
69% of businesses already have employees located outside of India, this is higher in tech and finance sectors.One of the key advantages of global hiring, as cited by 60% of respondents, is access to a wider talent pool. By casting their net beyond India's borders, organizations can tap into a more diverse range of skills and expertise, enabling them to build stronger, more capable teams.Moreover, 62% of organizations believe that global hiring contributes to shaping a more diverse organization. Diversity in the workplace brings fresh perspectives, fosters innovation, and enhances cultural understanding, all of which are crucial for success in today's globalized business landscape.The survey also highlights the importance of skills transfer, with 67% of organizations recognizing that hiring international talent enables local employees to learn from their expertise. As subject matter experts from around the world join Indian teams, they can mentor and share their advanced knowledge, upskilling local employees and strengthening the overall talent pool.Only 12% of organizations do not wish to hire overseas. Among these, 57% cite the lack of business entities or teams outside of India as the main reason.
AI and technology in HR
Indian firms stand at a crossroads, embracing AI to redefine operations, particularly in product development and HR. While excitement surrounds AI integration, uncertainty clouds the skills needed to maximize its potential. HR tech integration is widely adopted, but high costs remain a barrier for some.
95% of organizations are either integrating or considering integrating AIAlready integrated (51%)Considering (44%)Out of the 5% of organizations not yet considering AI integration-83% are adopting a wait-and-see approach, looking for more updatesAdditionally, 58% of organizations are not familiar with how AI could benefit their business.Some of the business units that companies show stronger intention for AI integration include:Product development (60%)Human resources (56%)Marketing (52%)Supply chain (50%)Finance (49%)87% of organizations are already using technology tools within their HR practices50% of organizations are managing 6 or more tools, highlighting the complexity of their tech stacksAmong the 13% of companies not integrating tech tools into their HR practices:42% cite high costs as the major challenge.44% struggle with digital transformation and keeping pace with the latest technological solutions.
Cost-Cutting Measures Amid Market Uncertainty
Indian organizations are increasingly prioritizing cost-cutting measures due to continued economic uncertainty. Technology-driven cost-cutting strategies emerged as a key priority. 62% of businesses surveyed are using automation and AI to streamline operations, while 61% are consolidating their technology stacks to reduce costs and vendor complexity. Although layoffs and salary cuts are being considered, they remain the less favoured options by India's business leaders. Remote work has emerged as a simple way to streamline costs, with 71% of business leaders surveyed highlighting it as a way to reduce overhead expenses.
73% of companies plan to implement some cost-cutting measures to cope with market uncertaintyCost-cutting measures that companies may consider adopting include:Use of new technologies like AI for business process automation (62%)Consolidate the technology stack, reducing technology vendors (61%)Staff layoffs (36%)Mergers (35%)Salary cuts (29%)71% of respondents believe remote work can help save costs.
Remote vs Hybrid vs In Office - Work Models
Organizations in India are navigating a diverse work environment, with a majority operating in hybrid mode. Despite the limited adoption of fully remote work, its relevance remains significant, especially among start-ups and respondents between the ages of 18 to 34.
56% of businesses surveyed are operating in hybrid mode, followed by 34% that are fully office-based, and 10% that are fully remote86% of companies still consider remote working relevant to their business directions, particularly among respondents between the ages of 18 to 34 (88%) and start-ups (98%)71% of organizations in favour of remote working believe it helps reduce costs. Other top benefits include:Attracting talent (63%)Boosting productivity (61%)Retaining existing talent (60%)Among organizations that don't find remote work relevant:56% believe working from the office offers better company culture41% say the market is back to normal35% cite a loss of productivity as a concern
Talent Attraction and Retention
Indian organizations are placing significant emphasis on work-life balance, flexible work arrangements, and career growth opportunities as key drivers of talent attraction and retention.
76% of organizations believe work-life balance and flexible work arrangements are the most significant contributors to talent attraction and retention63% of organizations believe opportunities for career growth and advancement as critical factors in attracting and retaining talentWhen asked whether Indian HR professionals experienced any trends at the workplace, respondents said they witnessed-
o Increased focus on mental health and well-being (62%)
o Greater autonomy and flexible working hours (55%)
o Silent quitting (mentally checked out, lack of motivation, considering leaving) (51%)
Navigating Global Payroll
As organizations expand their global footprint, the complexities of payroll management are becoming more pronounced, especially for those interacting with overseas employees.
For payroll management, 40% of HR or finance professionals use 6 or more tools62% of organizations cite ensuring timely and accurate payroll processing across different currencies, and exchange rates as the biggest challenge in global hiring. This underscores the intricacies of managing global payroll operations53% of organizations identified managing various vendors and payroll systems across different markets as one of their biggest challengesThese challenges are particularly evident in sectors like finance and technology, where 85% and 86% of companies, respectively, have team members working outside IndiaAs organizations increasingly hire global talent, addressing these payroll challenges will be crucial for maintaining compliance and enhancing the employee experience, which is essential for attracting and retaining top talent in a competitive market
Hiring based on geography and university campus
The majority of the organizations surveyed (96%) are still optimistic about India's talent landscape. Companies do not have a strong preference in hiring from different tiers of cities, with over half of them (54%) considering both metros, Tier 2 and 3 cities when hiring.
54% of companies will consider both metro and Tier 2/3 cities when hiring, while 20% will only consider metros and 26% will only consider Tier 2/3 cities.Among those considering Tier 2/3 cities, 75% expect these hires to be remote workers.Major factors driving hiring from Tier 2/3 cities are the availability of a skilled and job-ready talent pool (72%) and diversification of the talent pool (70%).Better infrastructure was flagged by 53% of respondents as a positive factor driving hiring from Tier 2/3 cities.Preference for types of institutes when hiring new talent is quite balanced. C-suite roles (51%) and start-up companies (50%) show a stronger preference for freshers from top-tier institutes.The majority of companies that focus solely on the local market are open to considering candidates from any institute.Over the past year, 61% of companies have increased hiring, including campus hiring.
About Deel
Deel is the all-in-one payroll and HR platform for global teams. It helps companies simplify every aspect of managing a workforce, from onboarding, compliance and performance management to global payroll, HRIS, and immigration support. Deel works for independent contractors and full-time employees in more than 150 countries, compliantly. And getting set up takes just a few minutes. Deel has recently announced the appointment of Todd Ford to its Board of Directors as Audit Committee Chair. For more information, visit Deel Blog or Deel.com
