Manufacturing sector has contributed less than 15 percent to the GDP thorough the years, and has contributed merely less than 12 percent to the employment generation. However, TeamLease expects GST implication to create formal jobs in the sector as the manufacturing outlook will increase in the upcoming quarter.
The sector has huge potential to make this growth huge and employment generation. GST implication will bring simplification in tax calculation, availability of input credit, reduction of cost of production, improved cash flows, ease of registration and lower cost to customer, and all this is expected having a positive impact on Jobs.
Implication of GST has been complex and has had a short term impact on hiring across organizations and industries. However, industry feedback suggests that within this quarter situation is bound stabilize and hiring shall resume.
According to IIP (Index of Industrial Production), the industrial production has witnessed a 1.2 per cent growth in July from a contraction of 0.2 per cent in June indicating a growth in the manufacturing sector. In fact, as per IIP data eight out of the twenty three industry groups in the manufacturing sector have shown positive growth during the month of July 2017.
GST implementation needs to be backed by on ground actualisation of the vision Make In India, smart cities, ease of doing Business, skilling India and a healthy regulatory regime to create the volume of formal jobs needed for a 13 million youth who are joining the workforce every month.
Consumption is seen growing across industries and TeamLease expects additional 50,000 additional jobs to be created in the next 5 months to cater to the increased demand on account of the festival season alone.