Indian SMEs Most Optimistic On Hiring, But Pace Lags 2023 Levels: Survey

New Delhi, May 17 (KNN) Indian small businesses are the most optimistic about increasing their employee headcount in 2024 across the Asia-Pacific region.

However, the percentage anticipating recruitment is significantly lower compared to the previous year, according to a recent survey by CPA Australia.

The online poll, conducted in late 2023 across 11 markets with over 4,200 small business respondents, found that 67 per cent of Indian participants plan to hire new staff this year. This figure is the highest among surveyed nations but marks a decline from around 86 per cent who intended to expand their workforce in 2023.

"While job creation by small enterprises remains robust compared to other markets, the pace is expected to decelerate in 2024," stated Prafulla Chhajed, a CPA Australia member in India. "Rising labor costs and increasing automation are likely contributing factors," he added.

Recruitment outlooks stood at 18 per cent in Australia and New Zealand, 42 per cent in mainland China, 53 per cent in the Philippines, and 52 per cent in Hong Kong and Indonesia, among others.

The survey highlighted increasing costs, competition, and cash flow issues as major hurdles for Indian small businesses last year, with staff expenses and material costs being the most detrimental. To support growth, 68 per cent sought external funding in 2023, down 20 percentage points from 2022.

Despite challenges, over three-quarters of respondents reported growth exceeding pre-pandemic levels in 2023. This positive momentum is anticipated to continue, with 84 per cent expecting expansion in 2024, well above the 70 per cent market average. Additionally, 80 per cent expressed optimism about India's economic prospects, compared to 65 per cent across surveyed nations.

While facing an uncertain global outlook, India's small business sector remains confident in its ability to drive employment and economic growth in the coming year, albeit at a more measured pace.

(KNN Bureau)