Today, with improvised technology and better communication channels, Human Resource can reach a large number of potential candidates to handle the talent crisis within an organization. However, there are still few challenges for HR leaders in recruiting the right person for their requirements.
According to a survey on HR Challenges, a common problem identified is “the difficulty of HR executives acquiring talent, as candidates have numerous options before them”. These options are not only limited to the private recruiting sector, but candidates even appear to be interested in public sector jobs.
Comparison of Government Jobs vs. scenario for private sector jobs (from the year 2010 to 2015)
There was a time when Native Americans wanted comfort and security in their jobs. This was the reason why the public sector was preferred over the private companies. Gradually, time changed and people realized the benefits of working in the private zone such as being open to ideas, creativity, rewards, recognition etc. This motivated Indians to join the private enterprise and prosper in their career growth.
As mentioned, there is a life cycle of each trend. The turn of the new millennium has seen tremendous growth in private enterprise employment compared to the public sector. Now this trend is somewhat in the “saturation phase” as people have returned to focusing on public sector vacancies, both newcomers and experienced private sector workers.
This scenario is one of the reasons why HR managers in the private zone experience the scarcity of talented candidates to fill the vacancies.
The government banking sector is a source of HR challenges in the private sector
Even if you take a sneak peek at a list of government job options, you will easily see the increased number of applicants at government companies. In particular, jobs in the public banking sector are on the rise, flooded with vacancies. Whether it is Punjab National Bank (PNB) recruitment or SBI recruitment for administrative or probation officers, a large number of job vacancies are available in India.
Let’s take a look at some striking government vs. private sector jobs
According to the ASSOCHAM (The Associated Chambers of Commerce of India) research report, the following points came to the conclusion:
More than 60% business school graduates prefer to work in PSUs compared to the private sector.
Since 2014, a significant increase in the need for the right talent has been observed at PSUs as a result of the public sector’s strategy to innovate and make it profitable.
Surprisingly, it is found that the public sector pays 30-50% less than what the private sector pays (this applies to top senior management).
An extensive analysis of the ASSOCHAM survey shows that MBA graduates are neither interested in running their start-ups, nor in the private sector. They are more interested in those jobs with fixed salary increases (like 6th and 7th payroll commission) and are not easily laid off even if they are not productive.
Here is a short list of some of the PSUs that receive a large number of applications each year:
SAIL (Steel Authority of India)
NTPC (National Thermal Power Corporation Limited)
BHEL (Bharat Heavy Electricals)
IOC (Indian Oil Corporation Limited)
SBI (State Bank of India) recruitments
Pnb (Punjab National Bank) recruitments
The salary factor
In the private sector, average MBA graduates receive a starter pack of about 3.5 lakhs, while in PSUs, the starter pack is somewhere between 8-12 lakhs.
Salary factor is another reason why graduates from top B schools focus more on government jobs than the private sector. Apart from the salary, there are other benefits that PSUs offer to their employees, which are much better figures when compared to the private sector.
After the recession in 2008, the Indian recruitment industry recovered very well, although it took companies about two years to get back on track. Since the year 2012, most graduates have faced substantial robberies by FMCGs and investment banks. This factor was also a driving factor behind graduates’ increased interest in Public sector companies.
Convenience and job security are the main reasons candidates prefer PSUs over private areas. Therefore, this scenario was also added as a “talent for hire” challenge for HR leaders.