It’s not just the bourses in the Indian share market that are freefalling following the downgrading of the US by credit rating agency Standard& Poor, but tremors are being felt, quite unbelievably, in a section of the media as well.
2 weeks after Standard& Poor downgraded the status of the US from the previous AAA to the current AA+, employees of more than one media houses are bracing themselves up for some hard times. Looming large before them is the possibility of late payment and cancellation of employee benefits. These are offices of the US-based media houses which are located in India’s Bangalore.
Says Shilpi, a senior correspondent with an US-based online news paper that focuses on travel and economy, “Ever since the US government’s budget deficit and rising debt burden came forth, our paychecks have been coming very late. Many of us have prior commitments like loan repayment which has become a huge problem, thanks to the late payment. Now, after the downgrade, we feel that we may not get paid this month at all. And this time, even our HR department is tightlipped on when we will get the checks on time or not.”
Varsha, a recruiter with the same newspaper says that the office was in the middle of a recruitment drive when the news of the downgrading came in. ’We were asked to freeze the recruitment,’ she says. The office is currently understaffed and the freeze means, the present staff will have to work extra hours till the crisis is over and new employees are hired.
R Shiju, a news analyst, shares this anxiety. Shiju’s office – a global newswire which moved its financial news division to Bangalore a few years ago, apparently with the aim to cut down operational cost. However, every time there is an economic crisis in the US,’ we get directly hit. In last recession of 2009, the office cancelled local travel allowance and some other benefits like extra payment for those we worked in graveyard shifts. This time, we are fearing a cut in our salary packages.’
Will the situation improve in coming weeks, or worsen further? That is something only time can tell.
**(names have been changed on request)