Industry lobby retracts report on 25 percent job cuts

October 31st, 2008 - 8:10 pm ICT by IANS  

New Delhi, Oct 31 (IANS) After invoking considerable concern and anxiety among millions of working Indians, a leading industry lobby Friday retracted its earlier analysis that the country’s corporate sector in seven major industries was proposing 25 percent job cuts over the next 10 days.”Assocham withdraws its report of 25 percent job cuts, clarifying that it was not representative of the industrial segment in its totality,” the Associated Chambers of Commerce and Industry said in a statement.

The statement came even as another apex chamber, the Federation of Indian Chambers of Commerce and Industry (Ficci) ruled out any immediate threat of large-scale layoffs in Indian industry.

Even Finance Minister P. Chidambaram had told reporters on the margins of a briefing on cabinet decisions here Friday that the government did not believe in the so-called analysis of Assocham.

“Growth at nine percent would signal rapid creation of jobs. But growth at lower rate does not imply destructive employment situation,” the finance minister maintained. “It is for this reason that I disagree with the Assocham study.”

In the widely reported analysis, the chamber said companies in seven sectors - steel, cement, real estate, information technology-enabled services, financial and brokerage services, construction and aviation - were looking at job cuts.

“Much more serious and alarming situation is emerging post-Diwali, under which corporate India is likely to announce lay off of nearly 25 percent workforce in next 10 days in seven key industrial segments,” Assocham had said.

“I have been consistent over the last few months in saying Indian economy is facing some serious challenges as a result of many quarters of tight monetary policy and the more recent International banking crisis,” Ficci president Rajeev Chandrasekhar said.

“However, we do not believe any immediate threats exist of the form that Assocham is alluding to. We should not panic,” he said, adding several steps were needed to put the economy back on the growth track.

“A steady, calm and complete approach is what is required at this very critical stage of expansion of our economy - which, as you realise, is being driven primarily by private investments.”

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