In the recently published International Labour Organization (ILO) Working Paper 94, “Who creates jobs with broad skillsets? The crucial role of firms,” researchers Giordano De Marzo and Angelica Sbardella from CREF, along with Nanditha Mathew from UNU MERIT, have collaborated with the ILO to study the role of Indian firms in shaping the labor market.

The research provides an in-depth analysis of how these firms create jobs requiring diverse skills. The study uses a substantial dataset from online job postings on Naukri.com, one of India’s largest job portals. The dataset spans 2016 to 2020 and includes 1,556,394 job ads from 5,237 firms. The average number of ads posted by each firm is 297. The study also includes data from 209 cities in India, providing a comprehensive view of the job market across the country.

The research methodology involved a detailed analysis of inter-firm heterogeneity in skill requirements and the relationship between skill demand and firm characteristics. Advanced machine learning and natural language processing techniques were used to analyze the data, providing nuanced insights into the job market.

The study found a close link between firm profitability and skill requirements. Cognitive skills were positively associated with firm profitability, while digital skills showed a negative correlation. The research also highlighted the importance of manual skills in specific industries, indicating the diverse skills required in the Indian job market.

Read the full paper