Automation signals the beginning of the end for the Indian coder
A recent audio clip that went viral over the internet in India has further shed light on the nature of the recent spate of firings taking place within the Indian IT fraternity. The clip allegedly involves the kind of chat which all of us salaried working folk dread, but in this case it was like a summary execution at dawn -- the employee was asked to put in his papers by the next morning and vacate the premises.
It is not often that the head of an Indian business empire publicly apologises for something his or her company has done -- that too, the firing of a mid-level employee which many will probably look at as relatively inconsequential in the grand scheme of all things business. But that's what Anand Mahindra, head of the $19 billion Mahindra Group -- which includes Indian IT firm TechM -- did over social media, explaining that one of the core values of the Group was to "preserve the dignity of the individual".
The apology is a nice gesture and underscores what a classy guy Mahindra is but it does nothing to change the narrative surrounding the torrent of firings taking place in the Indian tech landscape. Almost everyday, there are reports of mid-level managers with mortgages and car loans and kids in expensive private schools being given 24-hours notice to exit.
What is especially terrifying to this cohort is the fact that not only were they the kings and queens of the tech firmament not so long ago, perched imperiously high on their perches thanks to the seemingly unending demand for their services driven by the explosion of startups and the robust demand for IT services from overseas, but it seemed that if anything the demand for their skills was only increasing.
Today, they are a panic-stricken bunch, signing petitions to the labour commissioner, trying to jumpstart unions to protest their interest, and scrambling to find any kind of employment. Most of them are "project managers" who have been actively working with foreign clients and with the company for at least five years or more, hence their promotion to "manager" status.
The bloodbath isn't restricted to any one company. Cognizant recently introduced a "voluntary separation program" for directors, associate vice presidents, and senior VPs, offering them six to nine months of salary with the intention of shedding at least a 1,000 executives. Wipro, meanwhile, has already asked some 600 employees to exit as part of its annual "performance appraisal". In fact, almost all of the majors are using performance appraisal as a tool to shed what has suddenly become their excess baggage in this cruel new world.
So, how did star employees become excess baggage overnight?
Quite simply, the world has changed and with rapid speed. Infrastructure maintenance, application development, software testing, and tech support are no longer sought after, nor indeed are valid tech models, and have been replaced almost overnight by the cloud and digital solutions. These senior and mid level managers are not being replaced by other humans -- their jobs are being taken over by a sweeping wave of automation that experts say effectively saves the IT firm as much as 50 percent of their costs. It's a saving that is desperately needed considering their revenue growths have plummeted from over 20 percent just two years ago to around 5 percent today.
Research firm HfS predicts that India will lose at least 640,000 people by 2021, a decrease of 28 percent out of the current 3.5 million workforce. It's not all bad news -- HfS says that these low-skill job losses will be offset by 160,000 mid-high skilled jobs being created, which is a net 14 percent decline for the country.
Still, with 50 to 70 percent of IT workers' skills deemed irrelevant by 2020 and with at least 65 percent of IT workers deemed "untrainable", the time has come for these erstwhile high flyers to start a desperate hunt for new and relevant skills so they have a shot at being part of the new future.