According to real estate consulting firm CBRE, the office space absorption or leasing of new space in these cities has come down from 35 million sq ft in 2011 to about 26 million sq ft in 2012. Data from Cushman & Wakefield, another international real estate consultancy, shows leasing is down from 37 million sq ft to 27 million sq ft while Jones Lang LaSalle says new office occupancy has fallen from 36 million sq ft to 28 million sq ft.
In India, the thumb rule is that a white-collar worker occupies an average space of 70 sq ft. An 8-10 million sq ft reduction in new office space occupancy during the year means 1-1.30 lakh fewer jobs have been created this year compared with 2011. The seven towns and cities covered by these consulting firms in their surveys include the National Capital Region of Delhi, Mumbai, Pune, Hyderabad, Bangalore, Kolkata and Chennai.
The drop in new jobs mirrors the slowdown in the economy and the tepid rate of hiring in many sectors. "It is a tough situation. Hiring across sectors is down 25-30%," says Ajay Shah, general manager (sourcing) at TeamLease Services, a manpower consultancy.
While companies in the oil & gas, drugs and auto sectors saw some hiring, the biggest occupiers of space - the IT/ITes and banking & financial services sectors - witnessed a steep drop in recruitment. "IT firms have lowered hiring for future projects. Companies in other sectors have also reduced anticipatory hiring for new businesses. They are just going ahead with replacement hiring," says Ganesh Shermon, partner and head of human capital practice at KPMG India.
COMPANIES DEFERRING EXPANSION PLANS
Cities such as Bangalore, Pune, Hyderabad, Chennai, and satellite towns like Gurgaon have been at the forefront of white-collar job creation for the past many years, with both multinational and local companies across sectors setting up offices in these markets. This led to a boom in real estate, both office and residential, as migration to these cities hit a peak.
But the economic slowdown has taken a toll. Home sales have dropped, and with companies deferring expansion plans and postponing recruitment, the demand for new office space has been hit.
"The negative business environment globally and in India is making companies jittery. This is having an impact on job creation and subsequently on the demand for office space," says Anshuman Magazine, chairman & managing director of CBRE South Asia.
Sanjay Dutt, executive managing director (south Asia) at Cushman & Wakefield, said there had been a slowdown in demand for space from companies across sectors as expansion plans had been deferred.
http://economictimes.indiatimes.com/news/news-by-industry/jobs/companies-clampdown-on-office-space-in-2012-results-to-1-lakh-fewer-white-collar-jobs/articleshow/17606098.cms
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