Hiring uncertainty and poor pay checks make savings high priority

Indians have a fair share of concerns this time in addition to downturn. India may not be really perturbed by the recession, but, even the obedient nation, we are the sixth most concerned when it comes to parents’ welfare and happiness, and we are concerned about tolerance towards different religions. Not surprisingly, India is the most worried nation over terrorism.
Amidst the prevailing gloom over the jobs scenario, India offers a beacon of hope, according to the latest Nielsen Global Consumer Confidence Study. The survey is the largest bi-annual study of its kind, covering more than 26,000 internet users in 52 countries. Savings save Indians.
Sixteen per cent of those polled in the country think it is an excellent time for jobs, while 59 per cent feel it’s a good time. Consequently, the respondents’ perception of personal finances is just as glowing, as India topped the list as the most optimistic with 77 per cent; 9 per cent of Indians think it’s an excellent time while 68 per cent opine it’s a good time.
Meanwhile, internet users’ perception of personal finances in Japan was the most pessimistic at 91 per cent, up 12 percentage points higher than the June 2008 round. In keeping with the negative sentiment, 38 out of 52 countries are pessimistic about the economic situation in their country in the second half of 2008 with 63 per cent of the respondents saying that they believe they are in recession. Only three countries think they will be out of the economic recession in the next 12 months: China, India and Vietnam.
Absolute numbers have come down in India. Six months ago, 26 per cent thought it was an excellent time for jobs while 60 per cent said it was a good time. On the personal finance front, things are down by two percentage points. A report released by jobs portal Naukri.com states the overall job index in October 2008 was 781 as against 1,000 in July 2008. That’s a decline of a whopping 21.9 per cent. It is not as bad as the United States, but the numbers are down with many sectors retrenching or holding hiring.
The most palpable of all fears is the one that has stricken business schools. Many firms are not going to B-schools this year. Even if some are, they have drastically reduced the number they are hiring.
Some students even from prestigious B-schools are scrambling for internship offers because salaries are lower, offers are lesser and companies are fewer.
It’s going to be difficult, as many American and European companies may not come this year. The spokesperson for Indian School of Business agrees that the coming placements season will be challenging.
Still, while the rest of the world may be living from pay cheque to pay cheque, 58 per cent of Indian respondents said they were in the saving mode, though one percentage point less than in the last survey. Indians have gone a step further and slashed spending on holidays and vacations by 10 points. Spending on new clothes and out-of-home entertainment has dropped two and eight points, respectively. But not much has changed with regard to paying off debts, credit cards and loans.
Saving continues to be a high priority in these times of uncertainties. Both globally and in Asia more consumers prefer to save their spare cash than to spend. While 46 per cent of global consumers claim they put their spare cash in savings, in the Asia-Pacific the figure is a high 58 per cent.
Hong Kong leads the pack with 74 per cent consumers putting their spare cash in savings, up 11 percentage points in the last six months, followed by Singapore (70 per cent, up one percentage point) and Indonesia (68 per cent, up seven percentage points).
In India, too, savings remains the biggest priority, with 58 per cent consumers preferring to save their spare cash, almost the same as six months ago.