Reliance Industries Slashes 42,000 Jobs as Cost-Cutting Measures Intensify, Sparking Economic Concerns

Reliance Industries Ltd (RIL), India’s largest conglomerate, has implemented a significant workforce reduction as part of its strategic efforts to enhance cost efficiency. According to a report by The Economic Times, RIL reduced its total workforce by 42,000 employees during the fiscal year 2023-24, marking an 11% decline from the previous year. This workforce reduction, particularly concentrated in the company’s retail division, has sparked concerns about its potential impact on the broader economy.

The company’s total employee count fell from 3.89 lakh in FY 2022-23 to 3.47 lakh in FY 2023-24. New hiring also saw a sharp decline, with only 1.71 lakh new hires in FY24, compared to the previous year, representing a reduction of over one-third.

RIL’s retail business, which employs around 60% of its workforce, was the hardest hit. The number of employees in this segment dropped from 2.45 lakh in FY23 to 2.07 lakh in FY24. This reduction was accompanied by store closures and a slowdown in retail network expansion. While Reliance Retail added over 3,300 new stores in FY23, FY24 saw a net addition of only 800 stores, bringing the total to 18,836.

The telecom division, Reliance Jio, also faced a reduction in its workforce, with employee numbers falling from 95,326 in FY23 to 90,067 in FY24. Despite these cuts, RIL’s overall employee benefits expense increased by 3% year-on-year, reaching Rs 25,699 crore.

While RIL’s workforce reduction is intended to streamline operations and improve efficiency, it has raised concerns about the broader economic impact, especially given the company’s size and influence. The significant job cuts may reflect underlying challenges within the economy, particularly in sectors like retail, which are heavily reliant on consumer spending and economic stability.

The sharp cuts in the retail sector may indicate shifts in consumer behavior or changes in market conditions that have led RIL to reassess its workforce. As India continues to grapple with challenges in job creation, RIL’s large-scale workforce reduction could have far-reaching economic implications.