(from left) Rakesh Patil, Co-founder & CTO Beyond Appliances; Kartik Narayan, CEO of Apna Co; Nitin Dave, CEO, Staffing Solutions, Quess Corp; Nagaraju S, Council Member, Panel Chairman, Labour Law, KASSIA, Synergy Punching (Promoter and Director); and Bharat Kumar, Moderator, Digital Editor, businessline

MSMEs continue to face significant challenges in attracting, training and retaining talent, while rising compliance costs and evolving skill requirements add to overheads, speakers said at a panel discussion on Talent Skilling and Labour Challenges’.

Once MSMEs start helping their employees develop skills, deeper pockets in the open market will poach them, which adversely affects productivity in the MSME sector, said Nagaraju S, Council Member and Panel Chairman, Labour Law, KASSIA, while speaking at the MSME conclave.

Other speakers were Rakesh Patil, Co-founder and CTO, Beyond Appliances; Kartik Narayan, CEO, Apna Co; and Nitin Dave, CEO, Staffing Solutions, Quess Corp. The session was moderated by K Bharat Kumar, Digital Editor, businessline.

A recurring concern during the discussion was the inability of MSMEs to retain skilled workers after investing in their training. Nagaraju S, Council Member and Panel Chairman, Labour Law, KASSIA, said MSMEs often act as training grounds for talent that is later hired by larger companies offering better compensation.

According to Nagaraju, MSMEs require diverse skillsets, but there remains a gap between what institutions teach and what industry needs. He argued that practical problem-solving abilities are often more valuable than formal qualifications, noting that “common sense is good enough to work at an MSME”.

Narayan said compensation alone is not sufficient to retain employees. “Unless and until, along with compensation, some of the other employee experiences are fixed, I think it’s going to be a challenge,” he said, stressing the need for better workplace experiences and employee engagement.

Growth enablers

Panelists also discussed how AI could help MSMEs address resource constraints. Patil said smaller businesses need not invest heavily in specialised AI talent to benefit from the technology.

“Every MSME cannot afford multiple engineers, but having one or two engineers and using AI to multitask is possible,” he said, describing AI as a tool that can help improve productivity and automate processes.

Patil emphasised the importance of nurturing young talent through internships. He said his company maintains interns across departments, helping build skills while exposing students to organisational culture.

On compliance, Dave argued that adherence to labour and employment norms should be viewed as a growth enabler rather than a burden. “Compliance gives scalability, profitability and it attracts investment,” he said.

The discussion also touched on the need for stronger MSME clusters, with Nagaraju arguing that cluster development would play a critical role in improving competitiveness and supporting long-term growth.

Published on June 25, 2026