Thu, Jun 01, 2017 page10

• Automation affecting Indian IT sector

  JOBS VANISHING? The National Association of Software and Services Companies dismissed reports of thousands of layoffs, but said that the rate of hiring was falling

  • AFP, MUMBAI, India
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  Automation and a failure to keep up with new technologies is creating industry-wide upheaval in India’s information technology (IT) sector, experts said.

  IT outsourcing has long been one of India’s flagship industries.

  India’s business dailies have reported that major IT firms are gradually laying off thousands of staff, while research has showed that hundreds of thousands of jobs could disappear in the next four years.

  Experienced Indian IT worker Raghu Narayanaswamy lost his job recently and fears he might not get another as massive layoffs hit across the nation’s IT sector.

  Narayanaswamy was caught up in the turmoil in March when he was let go from one of India’s top IT companies after 11 years of service.

  He said his future prospects appear bleak.

  India’s IT sector boomed for more than two decades as Western companies subcontracted work to firms like Infosys Ltd, Wipro Ltd and Tech Mahindra Ltd, taking advantage of their skilled, English-speaking workforce.

  The industry employs nearly 4 million Indians and rakes in revenue of move than US$150 billion, according to the National Association of Software and Services Companies (NASSCOM) trade body.

  Although layoffs are not uncommon in the industry, particularly in the final quarter of the financial year, union bosses said that staff are being made redundant in unprecedented numbers this year as firms deal with narrowing profits.

  India’s top IT companies have been complaining for a while about the difficulty of picking up new clients as businesses explore automation, robotics and innovative technologies such as cloud computing.

  So analysts say it should come as little surprise if some are now streamlining operations.

  NASSCOM this month dismissed widespread reports, including in Indian newspapers like the Economic Times, Mint and Business Standard, of thousands of layoffs, but said that the rate of hiring was slowing.

  It predicted that up to 3 million new IT positions would be added by 2025, but added that the industry must reinvent itself to help companies keep up with demand for more innovative technologies.

  Kris Lakshmikanth, chairman of Bengaluru-based recruitment firm The Headhunters, told reporters that the task is huge, with about 60 percent of India’s 4 million IT workers needing to be retrained.

  Wipro and Tech Mahindra said they have retraining programs, but did not comment on the number of layoffs, saying it was standard practice for employees to lose their jobs if they failed to meet expectations.

  Infosys did not respond to questions from reporters.

  While NASSCOM is bullish about the future for India’s tech titans, HfS Research, a US-based business-advisory firm, estimated that automation could mean a 14 percent decline in India’s IT workforce, with 480,000 jobs at risk by 2021.

  That is a worrying prospect for the hundreds of thousands of aspiring engineers at India’s IT colleges.

  “There is a big tsunami that will affect between 150,000 and 200,000 Indian IT professionals and will continue for a long time until the industry stabilizes,” Lakshmikanth said of the challenges facing the sector.
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