Lay-offs rise as stagflation worries mount; Zee Business' research explains impact

Stagflation is emerging as one of the main issues for the industry. It is a situation of slow growth and high inflation. Zee Business' Senior Research Analyst Arman Nahar brings this exclusive report where he tells why companies are now begging to lay-off staff; to what extent could stagflation impact economy and what a weaker economy means for the company?

In his report, Nahar said that companies are laying-off people and that is reflective of how economic growth is slowing down while inflation is raising its head. 

Amid rising inflation, income is reducing and which is further lowering the value of whatever income people are drawing, he said.  

The Reserve Bank of India (RBI) and the Indian government are doing their bit to fight the growing inflation. 

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He gave a three-point scenario on stagflation.

He said that institutions such as the World bank and International Monetary Fund (IMF) expect the growth rate to be slow worldwide. He added that for this year, the World Bank changed its global growth forecast from 4.5 per cent to 2.9 per cent.

कंपनियों में क्यों बढ़ी कर्मचारियों की छंटनी?

Stagflation का कितना बढ़ा डर?

कमजोर इकोनॉमिक ग्रोथ से कितनी चिंता?

जानिए पूरी रिसर्च अरमान नाहर से...#Recession #Stagflation @ArmanNahar @AnilSinghvi_ @deepdbhandari pic.twitter.com/rqOjMLPEN0

— Zee Business (@ZeeBusiness) June 30, 2022

Nahar told Zee business that Companies such as Novartis are laying off 8000 workers while Coinbase global have decided to let go 1000 employees. Netflix, Tesla, are also among many other companies that have laid off workers or have plans for the layoffs.

High inflation has one more factor which has further impacted the growth, said Nahar.

Also Read: Byju's lays-off 500 employees; employees contest company's claim, says number is higher

He further added that the governor of RBI had also said that the current inflation is breaching the inflation tolerance band.