Search the Internet          Tips  Sites: Finance, Investment

In times of recession, job portals make a killing

Prachi Verma

Dot-com companies might be going bust but there is good news for some specialised portals even in a recession. With more and more job seekers in the market and companies looking at cheaper alternatives to the print medium for appointment advertisements, job portals are making a killing.

Suddenly, their portal business has become financially more attractive than ever before.

Savour this: Delhi-based alltimejobs.com has seen registered users more than double from 65,000 to 120,000 in the last six months.

Revenue from posting of bio-data has gone up by a staggering 300 per cent in the last three months over the last year (the company charges money for each bio-data posted).

JobsAhead.com has experienced a 22 per cent increase in advertisement from corporate posting of jobs in the last three months. The number of users has almost doubled from 400,000 to 700,000 in the last six months.

Registered users of yet another job portal, JobStreet.com, has jumped from 500,000 to 1.2 million in six months.

So what has changed for the over Rs 200 million job portal business? Well, the US slowdown has been a key reason for the unprecedented rush.

"The US slowdown has disturbed the demand-supply-talent cycle," says Puneet Dalmia, chief executive officer of JobsAhead.com.

The market has changed for online job portals in two ways. On one hand, there are now more job seekers which means more revenue for the dot-coms.

On the other hand, there is a discernible shift in job advertising, from the print to the Net.

Industry estimates the share of the portals in the total job market advertising kitty to be around Rs 2.50 billion. And it will go up from the 5 per cent share today to at least 25-30 per cent in the next two years, even if the ad volume stays stagnant.

Says Hitesh Oberoi, head of sales and marketing of Naukri. com: "As we get revenue from both strands -- the job seekers as well as the companies -- we will benefit from the recession."

Oberoi gives a small example: the cost of a half-page advertisement in the appointments section of a leading Indian newspaper costs Rs 600,000 for a one-day insertion. In contrast, Naukri charges Rs 600,000 a year for premium position for advertising jobs on its portal.

The portal, in fact, expects revenues to go up from the Rs 30 million last year to Rs 100 million this year.

Avers Saumya Meattle, CEO of alltimejobs.com: "We have experienced a 50 per cent increase in corporate job advertising on our website in the last three months. We expect this to increase by 5-10 per cent every month, because net advertising is a cheaper alternative to print. This also improves our viability."

Advertising agencies agree that the shift is already happening. Says Preet Bedi, director of Lowe Lintas and Partners : "There is a clear shift, especially in middle and lower level job advertising to the Net. After all, the cost of entry is low and companies do not mind experimenting with this medium now. Even if they succeed in three out of 10 advertisements, they are happy."

The growing revenues is already reflected in the fact that at least one of the job portals has been able to get fresh venture capital funding in a market were funds have dried up for portals.

JobsAhead has raised $2.5 million from Chrysalis Capital and other investors. The boom has also helped the portal to revise its cash break-even target from December this year to June-end.

The profile of the job seeker on the Net is also changing, with the IT sector taking the lion's share. Naukri, for instance, has seen a 10 per cent rise in the number of IT job seekers in the last six months. In the last 3 months, the number of IT visitors registering on the site has again grown phenomenally.

With this, the number of people visiting the site from the IT hubs of Bangalore, Madras and Hyderabad has also grown, as a percentage of the total kitty.

At alltimejobs.com, about 25 per cent of the total users were from the IT background about six months ago, but now it is as high as 50 per cent, says N Muralidharan, managing director & vice-president of the company.

Another surprising fact is that there are now more job seekers in IT than available jobs. Industry estimates say that the gap is over 20 per cent. Earlier, the reverse was the norm with more jobs than job seekers in the IT sector.

"Job placement agencies are no longer keen on taking on IT professionals. Now the trend among the job placement agencies is to provide more of IT-enabled services and non-IT jobs like in banking and finance, services and biotechnology," Meattle explains.

What is more, there are more experienced job seekers than ever before-- again a clear indication of the pressure on jobs. For instance, alltimejobs.com discovered that at present the average experience of job seekers ranges from 3-8 years, compared to 0-3 years about six months ago.

JobsAhead.com also found a similar trend. Earlier, the majority of users had work experience of 0-3 years but now close to 70 per cent of the current number of resumes are of experienced professionals with 2-14 years of experience.

The message is clear: job portals have quite a job on their hands. But they are certainly not complaining.

Powered by

YOU MAY ALSO WANT TO READ:
The Rediff-Business Standard Special
The Budget 2001-2002 Special
Money
Business News

Tell us what you think of this report