Economic growth has slowed but banks are not ready to reduce
Bengaluru, India-November 18, 2019: However the economic growth has slowdown banks have not reduced hiring. Backed by the technology they are increasing more branch work and adding more to the work force. Some banks are using artificial intelligence to identify the right candidate.
Companies that create artificial intelligence based solutions for clients globally are increasingly putting technology to greater use internally, particularly in functions such as hiring owing to the sheer numbers they handle.
Rajkamal Vempati, head of human resources (HR) at Axis Bank, told Business Standard: “We have
hired six times more of employees this financial year (FY) as compared to last year. Going forward, we are expanding our branch network; therefore, we will need more people at different levels, with specific skill sets. We are investing in workforce backed with technology”. Axis Bank used algorithm-based video interviews along with aptitude tests to hire around 2,000 customer service officers from a pool of more than 40,000 applicants this year, said Rajkamal Vempati, HR head of the private sector bank, adding it could standardise and scale up the process of hiring.
The Indian economy is passing through a phase of economic slowdown, with the GDP growth registering one of the lowest rates of 5.8 per cent in the last quarter of FY19. While there is a consensus that the economy is slowing down, the debate is still going on whether the slowdown is structural or cyclical. The disruption in industries is not cyclical or because of economic slowdown. There is a structural shift in many industries because of technology or shift in consumer preferences. Automation is affecting jobs in both manufacturing and services, which displacement is also affecting the consumption cycle. For the last quarter of 2018-19, India’s GDP grew at 5.8%, well below the 7% average that it has clocked over the last few years. Estimates based on the proxies that forecasters use, like car sales or corporate profits, suggest that the first couple of quarters of the current fiscal year are unlikely to show a dramatic recovery. A more alarming prognosis is that this slowdown is structural.
This could mean growth rates of around 6% is the new normal. Persistent sluggishness in activity over a few quarters does not de facto make a slowdown ‘structural’. One has to carefully identify a shift in some aspect of the economic environment that is likely to endure in the long term.