56,000 Layoffs and Counting: India's IT Bloodbath This Year May Just Be the Start (qz.com)

An anonymous reader quotes a report from Quartz: For Indian techies, 2017 was the stuff of nightmares. One of the top employment generators until a few years ago, India's $160 billion IT industry laid off more than 56,000 employees this year. Some analysts believe this spree was worse than the one during the 2008 financial crisis. Meanwhile, hiring plummeted, with entry-level openings having more than halved in 2017, according to experts. Tata Consultancy Services (TCS) and Infosys, two of India's largest IT companies and once leaders in job creation, reduced their headcounts for the first time ever. Even mid-sized players like Tech Mahindra retrenched several employees.

Compared to the normal rate of forced attrition (i.e. asking non-performers to leave) of around 1% in earlier years, 2017 saw Indian IT companies letting go of between 2% and 6% of their employees, said Alka Dhingra, general manager of IT staffing at TeamLease Services. Infosys cut 9,000 jobs in January. "Instead of 10 people, what if we have three people to work on (a project). If we don't have the software, then some others will take the advantage (away from us)," Vishal Sikka, the former CEO of the Bengaluru-based company, said in February. Meanwhile, around 6,000 Indian employees at Cognizant reportedly lost their jobs to automation.

Comments

Re:Non-performers...1%

[Junta]

companies will start taking a sharper look at their hiring practices and employees on staff.

Hilarious. But seriously, their industry is made to look really bad by the get rich quick outsourcing. The good news is that being in that position allows them to make out like bandits by charging for work to be done and then hiring unqualified to fulfill the arrangement. The bad news is everyone starts assuming that's what the entire India IT tech industry is, and that's very unfortunate and is a big obstacle to ambitions of truly stepping onto the world stage as a first class industry rather than just the cheaper choice.

It's similar to China's situation with manufacturing. They got in the door by, among other things, compromising on quality for the sake of cost. Now as they are doing a lot to improve the situation, they have a lot of skepticism to overcome from previous experience. Similarly South Korea was a source of crappy knock-off product though the mid 90s, but they have successfully moved beyond that.