IT hires may dip 22 percent in India

Industry body Nasscom says IT sector will reduce its new hires to 150,000 in the current fiscal year, dragged down by increasing automation and low attrition.
Written by Eileen Yu, Senior Contributing Editor

India's IT sector is projected to reduce its hiring plans by up to 22 percent to 150,000 in the current fiscal year, dragged down by increasing automation and low attrition in the industry. 

To cope with the hiring decline, some universities encourage their students to look at entrepreneurship and new segments such as biotech.

Nasscom expects between 150,000 and 180,000 new IT hires this year, compared to last year's 230,000, according to reports this week by The Economic Times, which cited the industry group's president Som Mittal. 

There are some 3 million professionals in India's IT and IT-enabled services sector, which is worth about US$108 billion. The attrition rate dropped to about 14 to 15 percent in this segment, compared to the country's average at 20 percent. 

"[Hiring] might be less than last year, as it is getting non-linear and lower-end jobs are getting automated," Mittal noted. "The profile is changing and we need more domain experts." 

He warned that as employers were now focusing more strongly on technical skills and leadership qualities, than technical skills, the recruitment of fresh grads might also fall to about 60 percent of last year's number. Three years ago, 80 percent of hiring was focused on acquiring technical skills, but this has dropped to about 40 percent, with companies preferring to hire domain skills. 

"Ten years ago, we could hire half the graduating engineering student but now, there is global uncertainty, automation, and non-linear growth. We cannot provide jobs to all," he said, adding that one-third of engineering graduates were at risk of remaining unemployed. 

According to The Economic Times, hiring among India's four largest IT companies--Tata Consultancy Services, Infosys, Wipro, and HCL Technologies--declined by over 60 percent in the second quarter, adding 4,100 to their headcount compared to 10,900 in the same quarter last year.

The report noted that graduates not from Indian Institutes of India (IIT) or who are from tier 2 colleges were now expanding their scope to other industry segments, and settling for pays lower than the minimum benchmarks. The change in employment climate had also pushed students into entrepreneurship. 

Bangalore-based RV College of Engineering, which has some 1,000 engineering graduates each year, said it evangelizes the rewards of entrepreneurship among its students, and noted that 12 percent of its alumni over the past 50 years had become entrepreneurs. 

Delhi Technological University encourages its students to diversify from computer science and traditional IT segments, and explore other sectors such as pharma, biotech, and manufacturing. 

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