Telecom sector consolidation to hit employment hard

The telecom sector has been one of the highest employment providers across India. However, with rife competition, the expansion opportunities for the industry is drying out.

The consolidation in the telecom industry, ensued from the high data stakes with the subscriber base increasing over a billion, has risked a large number jobs in the nation.

It is expected that, a third of the total 2.2 million direct employees in the sector and 1.8 million indirect employees will lose jobs as a consequence of the consolidation.

With most players exiting the market, and the giant players unifying to build benefit from large scale operations, is likely to reduce the market players from 13 to 4 in the span of a year. Thereby exhausting jobs and consuming small middlemen in the process.

A significant decrease in the employee base and sequential of 5.3 per cent and annual decrease of 2.5 per cent y-o-y in the employee cost of telecom giant Bharti Airtel has been already observed.

While, the Vodafone and Idea merger is likely to reduce 30-40 per cent of the employment in the sector over a year and, Aircel-Reliance merger is expected to result in a loss of 5,000 jobs.