Step Up Or Be Sidelined
Indian IT services industry is battling large-scale layoffs and reskilling seems to be the only alternative
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Once considered the hottest sector to work in, the sheen of the IT industry in India seems like it is fading. If you weren’t in IT, you hadn’t yet arrived in life. Consider the perquisites: job security, salary, and, of course, the aesthetically designed offices with ergonomically appealing furniture. No wonder then, thousands of graduates queued up to work in IT companies, which boasted of a 100 per cent recruitment rate. Today the scenario has changed. It is now considered a risky sector. Here’s why: employees in the IT sector are being abruptly shown the door and most of the hiring has been put on freeze. Clearly, the industry has undergone a dramatic U-turn from what it used to be and a bounce back seems unlikely anytime soon, unless the sector thinks 10 steps ahead and puts the pedal to the metal on reskilling.
The job loss scenario in the country could be a prolonged affair with almost 1,000 jobs being lost every working day, over the coming few years, says D. Venkat, CEO of Strides India Consulting, a Chennai-based HR consulting firm. “Job losses in the country across sectors, led by IT services firms, will continue over a 3-5 year time horizon; the process will be slow and painful for the employees and the country until 2022 as per the present forecasts.”
As per Strides India Consulting estimates, the number of job losses across sector could vary from a conservative 6 lakh people to a alarming 10 lakh in the next five-year horizon. This would translate to about 2 lakh job losses per annum beginning 2017.
Tech Mahindra is reportedly laying off around 1,500 employees at various levels in the organisation stating it as an annual restructuring exercise by letting go off poor performers. Though most of the analysts have attributed technologies such as automation as the core reason for the massive layoffs, there could be more to this than meets the eye. US President Donald Trump’s ascension and his policies that make it almost mandatory to hire from the US locally, irrespective of cost differentials, have impacted the very pricing of the services delivered by these firms, which were profiting from cost saving by hiring in India, and sending people there on H1B visas, says Venkat. “The new situation clearly puts a lot of pressure on the bottom line of the IT services companies, and so, they are left with no option but to save hugely on people costs,” he says.
As a direct consequence of the protectionist measures under US president Trump, India's second largest IT services company, Infosys has raised local hiring in the US. In May 2017, Infosys announced its plans to hire 10,000 American technology professionals as Infoscions over the next two years. “Indiana is the first of four hubs where we will build a strong local presence, with a focus on education and innovation in areas such as AI, Big Data, and more. This journey to increase our local hiring efforts first started in the fall of 2014 with our endeavour to hire 2000+ visa-independent talent into our workforce,” Vishal Sikka, MD & CEO of Infosys said in a letter to company shareholders.
Wipro too has significantly stepped up investment and hiring in the US. In FY17, the company added two more major multi-client delivery centres in Mountain View, California and Farmington Hills, Michigan. During the fiscal, over 3,000 local employees joined Wipro in the US and today, Wipro has a workforce of over 14,000 in the US. “We are driving increased localisation and expect to have a majority of our US workforce as local employees soon. Similarly, we are making good progress on localisation initiatives in the UK, Singapore, Middle East and other parts of the world,” says Abidali Z. Neemuchwala, CEO, Wipro.
Reskilling: The New Code
According to Strides India Consulting, employees must look at training themselves on newer skills so that they are employable in other sectors. “Organisations that cut jobs must also do their best to facilitate such a career and skill transition,” says Venkat.
Though layoffs are inevitable in redundant roles, companies seem to be doing their bit in reskilling their employees. For instance, Infosys is training some of its workforce in future-oriented skills such as AI and machine learning by developing completely new programmes, which have now been delivered to more than 1,300 employees, with several thousand more to be trained in the next few months.
“We have instituted a programme to train all new hires in three programming languages (17,000-plus employees have already gone through this programme)... We have created new learning platforms to meet the varying needs of Infoscions, including the Digital Tutor social learning platform and the Infosys Learning Platform,” says Sikka.
Similarly, Wipro has trained over 39,000 employees on digital skills in FY17 taking the total headcount of digitally trained employees to over 60,000. “During FY17, various internal learning initiatives such as OneVoice, ADROIT, PRISM, WinMore, TopGear focused at various employee segments across sales, delivery, middle management, bench, technology and domain teams have been well accepted. For example, over 32,000 employees have enrolled on TopGear, the social learning and crowdsourcing platform, and contributed to over 20,000 assignments and case studies and over 100 IP development projects,” says Neemuchwala.
If you are in the IT sector, there seems to be no alternative but to reskill yourself, and fast — regardless of a fresher or an experienced hand. Freshers seem to be in a better position as companies find it easier to train and mould them as per their requirements. Infosys has earlier stated that it will continue its campus recruitment drive and hire at least 20,000 students with a focus on emerging technologies.
The bottomline: There’s no point of brooding over the layoffs because the pace of change in technology waits for none. If you are ready with the latest skills, you could probably escape the painful task of clearing out your desk and stay safe. And even if there seems to be a decline in prospects in the IT services sector, emerging product-based companies and startups will be willing to hire you. After all, luck favours the prepared!