E-commerce giants reinforce their blue-collar workforce ahead of festive season

E-commerce platforms like Amazon India, Flipkart and Zomato, ahead of the festive season, have begun adding new members to their blue-collar arsenal. As the pandemic-era curbs have fuelled strong growth in online ordering, the e-commerce giants are luring them with joining and performance-linked bonuses to efficiently meet consumer demand.

This festive season, the e-commerce companies and logistics operators are expecting a sales estimated to rise as much as 15% more than the pre-pandemic festive season in 2019, said Nilabh Kapoor, business head, OLX People, a recruitment service provider.

“With businesses recovering in most parts, hiring of temporary workers has seen 3-4X growth in the recent past and is expected to double during the festive season to keep up with rising demand across platforms,” Kapoor said.

Though consumers are gradually returing to bricks and mortar way of shopping after government eases lockdown restrictions following the second wave, e-commerce companies are still confident that consumers will keep adding products and services to their digital carts. Overall consumption demand has trailed behind the uptick in e-commerce sales, and that trend is unlikely to change this year.

Companies that have gained from the pandemic era are on a hiring spree. As per industry estimates, 300,000 to 500,000 blue-collar workers will be hired in 2021. As many as 40 million new customers are expected to shop on e-commerce platforms this year, taking the overall user base to 190 million users, according to staffing firm TeamLease Services. Furthermore, the industry executives believe that the growth in users will continue to boost hiring in the remaining half of the year, especially the coming festive season.

The second wave of the pandemic was managed in a much better manner as compared to the first one, as companies and workers were better prepared, with lower labour migration and timely lifting of lockdowns.

“The second covid wave has not impacted the availability of migrant workers as much as last year. Many migrant workers returned once the lockdowns were lifted in their native districts, helping companies scale up faster this time around,” said Ajoy Thomas, business head (retail, e-commerce, logistics and transportation) at TeamLease Services.

Suchita Dutta, executive director of the Indian Staffing Federation, said there is a shortage of manpower as migrant workers are still hesitant to return because of the fear of a potential third wave.

“However, the return is not the only reason for the demand-supply gap. The lack of skilled resources to meet the demands also contributes to the shortage,” Dutta said. With business expansion plans taking shape and government projects on the upswing, the labour market is witnessing very high demand.

However, speaking of the salaries, Kapoor from OLX says that the workers’ salaries have still not seen an increment in line with the demand surge. And, in some cases, salaries have been restructured to offer a higher performance-based payout as compared to pre-covid times, reducing the take-home pay.

But on the up side, several companies are offering benefits such as joining bonuses, retention bonuses and attendance bonuses to recruit workers.

Companies in the e-commerce and logistics industry are reducing their fixed costs by offering bigger performance-linked incentives to attract workers, said Thomas of TeamLease Services.

“Companies have also started investing in people capital by upskilling their employees and enabling them with new skill sets. Rise in demand, expansion across businesses and other variables such as engine fuel price hike, etc., is expected to increase blue-collar workers’ salaries. With digitization, it has also become important to help this segment with more and more learning opportunities so that this new normal doesn’t turn out to be a bane for them,” Kapoor said.

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