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Arvind B has a degree in mechanical engineering from a top Delhi institute. Not happy with the way his career was progressing, he did an MBA with specialisation in Finance. Much to the envy of his friends, he got placed in a top MNC bank in Singapore with a paycheck that would make many of his contemporaries drool.
This is not Arvind's story alone. There are many such students who give up their expertise in core sectors for high paying jobs in consulting and banking. If you look at the placement sessions at a top management school, you will find the first day is dominated by the consulting companies. "The proportion of top ranked students hired by manufacturing companies is quite low," says Rituparna Chakraborty, vice-president, Indian Staffing Federation. According to a 2013 BCG-CII Campus Survey on the manufacturing sector, less than 15 per cent of Day 0 companies are from the manufacturing sector (see Statspeak below). One reason for this could be that these companies do not perform well on the brand building and job offer front compared top their counterparts in other sectors. In fact 85 per cent of students surveyed said they did not understand the true potential of the manufacturing sector.
The survey reveals that there is an urgent need for manufacturing companies to better market their job offering among students by laying down clearly the career growth path at their organisations. Companies also have to emphasise their key differentiators - ESOPs, fringe benefits, job security, better work-life balance and opportunity to acquire domain expertise through specialisation and job rotation vis-a-vis employers from other sectors.
Experts say while so-called modern sectors such as IT/ITes, consulting and banking pay more at the beginning, the growth potential in the long-term is extremely attractive in the manufacturing sector as well. "There are cases of individuals who have gone back into manufacturing after seven-eight years in the services sectors. Such case studies and success stories should be shared at the pre-placements talks. The manufacturing sector needs to work with the placement teams and offer insights on how careers can develop in the sector," says Srinivas Ghanagam, head of HR, Freudenberg Regional Corporate Center, India.
That said, the sector does fall behind in the glamour quotient. There are social issues too. A huge chunk of manufacturing jobs are based in industrial townships (usually Tier-II and Tier-III towns). Many parents don't want their children to work in factories on the outskirts of cities. "The sector needs to understand the pulse of the community and send the right message across. Poor HR, marketing and brand pull followed by the industry's conspicuous absence on campuses is in sharp contrast to service sector companies that invest heavily on campus activities," adds Chakraborty.
The difference between the average salary of a manufacturing worker and his counterparts in financial services, or IT and ITES, is higher in India than in countries such as the US, China, and Germany. For instance, salaries in manufacturing in India, at least at the entry level, are lower than those in financial services by around 30 to 65 per cent. This is much higher than the 5 to 25 per cent range observed in the US, according to the study. Also, job profiles offered by manufacturing companies are perceived to be relatively bland (compared with the offers in services), in terms of designation, the variety of work, travel, networking opportunities etc.
This trend is worrisome. The study says the share of manufacturing in the country's GDP has remained flat; so is the investment in employee training, resulting in only marginal improvement in people productivity. On the other hand, the services sector has spent bigger amounts on training people over the years and has seen a steady improvement in productivity, thereby improving its share in GDP.
The study says such insights should be taken as a wake-up call for the manufacturing sector, which needs to put in place not just stringent measures to boost workforce productivity but must first try to woo the right candidates.
