The Indian retail industry estimated at $435 billion and is expected to witness a CAGR of 18.1 percent over the next 4-5 years.
According to a report by National Skill Development Corporation (NSDC), India will need around 56 million strong workforce in the India’s booming retail sector. This sector will have human resource requirement of 17.35 million from 2013-2022 across the 24 sectors.
According to the findings of the report, the Indian retail industry estimated at $435 billion and is expected to witness a CAGR of 18.1 percent over the next 4-5 years and reach $ 848 billion.
The report states that the sector contributes to 23 per cent of the GDP, which is driven by an increasing Private Final Consumption Expenditure (PFCE) over the last few years growing from Rs.19 lakh crores in 2005 to around Rs. 51 lakh crores in 2012. In terms of Foreign Direct Investment (FDI) – cumulative value of retail sector has more than doubled driven by liberalization in single brand retail norms growing. Organized Retail is no more an urban phenomenon. It is estimated that tier 2 and smaller cities will evolve fast to constitute majority share of the organized retail in coming years.
Dilip Chenoy, MD & CEO, NSDC, said, “The potential for growth is huge in the sector. There are opportunities across various job roles in retail which the youth can capitalise on. The metro cities are the major consumption hubs and preferred destination for large scale retail. To match the requirement of skilled manpower we need to further scale up our efforts. The sector not only offers jobs but also entrepreneurship opportunities to the trained manpower.”
Organised retail is projected to grow at a CAGR of 29 per cent, with an increase in penetration of organised players from 7.7 to 11 percent of the entire sector. As per National Sample Survey (NSS) 68th round survey, the distribution of workforce in the industry is concentrated with top five states (Uttar Pradesh, Maharashtra, Andhra Pradesh, West Bengal and Tamil Nadu) accounting for over 45 percent of the employment. These states are major consumption centres and home to India’s largest cities.
According to the report, the employment base of the industry is expected to reach 56 million by 2022 across conventional and specialised retail segments. While lack of premium attached to skills still remains a challenge in the sector, policy impetus is driving the focus on training.
Shortage of trained manpower at various levels and lack of retail training institutes have prompted several retailers to launch in-house training programs for their staff or setup their own training facilities in India. Since educational qualifications are not aligned to retail requirements, even at entry level, the retailers have to invest a lot in training the entry level employees as well. Training may vary from a zero (on the job) to a few days (typically for generalists in segments such as food and grocery) to weeks (for specialists in segments such as high end lifestyle brands).