The placement consultancy business in Bangalore thrives mainly on the outsourcing industry. In recent years, when companies have been ramping up at astounding rates — some of the bigger ones such as Infosys Technologies have hired up to 10,000 employees in each quarter — placement consultancies too had their glory days.

Typically relying on a bank of resumes, referrals, head-hunting or even foraging on job websites, placement consultants channel employees to companies. For each employee recruited, companies usually pay a month’s salary as consultancy fee.

Shastri specialises in hiring for multinationals, and a candidate getting hired for a Rs-1-lakh salary meant that the consultancy earned as much. But the recent financial crisis is fast heading into a downward economic spiral in the United States. With the US accounting for about two-thirds of outsourcing to India, outsourcing firms’ business prospects are dented. In turn, this has hurt the job consultancies.

Nasscom, the outsourcing industry trade body, projects that the industry which has been growing at 30 per cent plus rates will slow to around 20 per cent, and a further downward revision of the growth seems a possibility. So, consultants like Shastri openly declare that they are in trouble. “These days we consultants meet up to cry on each other’s shoulder,” said Shastri.

Firing his own staff was wrenching, he said, but he did not see business improving, “at least in the near future”. He has not encountered such a gloomy scenario in the 17 years of his company’s existence, Shastri recalled.

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