Are Indian Start-Ups Over The Layoffs Wave? Check The Details Here

Start-up Layoffs: Major companies that announced layoffs include Ola Electric, One97 Communications, Byju’s, Unacademy, Swiggy, Flipkart, Waycool, Healthify, and The Good Glamm Group

According to the data, start-ups are still hiring 35-40 per cent fewer employees compared to the peak levels of 2021-22

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Start-up Layoffs: Indian start-ups cut fewer jobs in the first half of 2024 than in the same period last year and the previous six months, according to the data from Longhouse Consulting, an executive search firm.

From January to June 2024, start-ups laid off nearly 11,250 employees. This represents a significant decrease compared to the 21,000 jobs cut in the first half of 2023 and the 15,000 jobs eliminated in the second half of 2023. This data highlights a notable reduction in job cuts over the past year in the Indian start-up ecosystem.

Although the number of layoffs has decreased in 2024 compared to 2023, start-ups are still grappling with significant challenges. These include a persistent lack of funding and a pressing need to conserve costs. In response to these difficulties, some startups are exploring strategic moves such as planning initial public offerings (IPOs) to improve their financial stability and growth prospects.

"The intensity has reduced; the bottom is behind us, but it’s not like good days are immediately ahead," The Economic Times reported, citing Anshuman Das, CEO of Longhouse.

According to the data, start-ups are still hiring 35-40 per cent fewer employees compared to the peak levels of 2021-22. However, there has been an improvement in hiring compared to last year. In 2023, start-ups employed 60-70 per cent fewer people than the previous year. 

This situation represents an improvement over 2023, when start-ups were heavily engaged in an 'Operation Clean-up' phase, which, as noted by Das, resulted in over 36,000 job losses compared to 20,000 in 2022 and more than 4,000 in 2021. 

Major companies that announced layoffs include Ola Electric, One97 Communications, Byju’s, Unacademy, Swiggy, Flipkart, Waycool, Healthify, and The Good Glamm Group.

ET cited a CEO of an edtech start-up as saying, “There may be some pockets where some layoffs are still happening or will happen, but most of the calls that were supposed to be taken have already been taken. Most companies have now tightened their screws enough already. IPOs are one place where most are trying to get the costs right; there may be some bigger issues with large companies like Byju’s or wherever more M&As may be happening."