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

Non-performers...1%

[HornWumpus]

WTF? 1% of Indian techs are incompetent?

Is this the new king of broken metrics? What is 'competent'?

Re:Non-performers...1%

[Scarred Intellect]

I think my company hired those 1%....so don't worry, they're still gainfully employed!

Re:Non-performers...1%

[HornWumpus]

Nobody bats 990 in hiring. Especially not when the market is super hot. That calls for a higher kick rate, not lower.

Anybody claiming 'we have only 1% incompetents.' is actually saying 'We never question management, revisit decisions or do anything like failure analysis. (Our Brahmen's shit doesn't stink.)'

The deeper cause has to be clients slowly getting smart and changes to US visa laws.

Who the fuck still hires Tata? I would, if I hated my employer, was six months from retirement and wanted to wreck the joint. Would the SEC consider knowing they had hired Tata insider information?

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.

Re:Non-performers...1%

[gtall]

I have a 5 digit ID and I can certainly remember Japan being synonymous with poor quality. They were also known for low end of any markets. Then they got smart, hired efficiency and quality experts and having a fairly uniform population, were able to pull out of their rut. That was the second phase. Now they are into their third phase where some of their industries are tired of the constant improvement and are looking to cut corners and their managers make off with the loot before the shit hits the fan. Maybe they'll pull out of it before hitting a wall.

Re:Non-performers...1%

[Anonymous Coward]

I have a 5 digit ID and I can certainly remember Japan being synonymous with poor quality.

Indeed. They made a joke about that in the Back to the Future movies, playing upon how different generations viewed Japan, where 1950s Doc Brown commented something to the effect of "No wonder this circuit failed, it says made in Japan." to which 1980s Marty, who's fond of the Sony Walkman and other Japanese electronics, replies "What are you talking about Doc? All the best stuff is made in Japan."

1% under performing? Really?

[Tangential]

Based on my experience with I.T. offshoring in India, I laughed out loud when I read that 1% represents the under performing employees. Perhaps its a nuance of the language and underperforming has no relationship to to good service or solving problems there.

They heard 56k was being retired...

[torkus]

But they didn't realize we meant the modems and went ahead with the business plan anyway. Don't worry, next year they will have a new proposal since this one didn't perform completely to expectations.

Automation will hit developing and 2nd world

[rsilvergun]

economies hard. All three articles mention it as the cause. We're at the point where subsistence wages are more than a machine. I think India's government sees this coming and is trying to bring tax dollars in to mitigate it, but I'm guessing it'll be too little, too late. Like America and Japan they've got a culture of overwork. But what do you do when the world doesn't need ditch diggers anymore? If you leave them to rot their join armies and start wars and genocides.

Side effects of “America First”

[magzteel]

Donald Trump’s arrival at the White House earlier this year hasn’t helped.

Since Trump took office, the fate of the H-1B, a six-year temporary work visa that Indian IT companies heavily depend on, has been hanging fire.

In March 2017, the US government stalled the premium processing of this visa category.

The criteria for computer programmers to apply for the H-1B visa became tougher. In April, Trump signed the “Buy American, Hire American” executive order, promising to bring jobs back to the country, putting migrant workers in jeopardy. In November, the judicial committee of the US House of Representatives gave its nod to the Protect and Grow American Jobs Act (titled HR 170) which classifies any company that has more 15% of its workforce working on-site as “visa-dependent.” With this, the pressure is mounting on Indian outsourcing giants which sometimes have over 50% of their manpower working on-site.

Even the current workers have cause for concern—to clamp down on visa fraud, the United States Customs and Immigration Services (USCIS) plans to double the number of visits to workplaces. “Indian IT companies, thus far champions of IT-based outsourcing, have been forced to go back to the drawing board in order to reposition themselves higher up in the value chain,” Anshul Prakash, a partner at Mumbai-based legal services firm Khaitan & Co, told Quartz.

Re:Side effects of “America First”

[HornWumpus]

Changing the H1B allocation process from lottery to 'highest paid' cuts the Indian body shops off at the knees.

It's still 'gameable', but not on the cheap.

Re: Thank Trump instead

[93 Escort Wagon]

Oh, I was unaware the Orange One brought any tech jobs back.

He apparently also caused the current economic boom in the US... pre-emptively, in fact. Even before he announced his candidacy for president, the aura of his magnificence was already causing the economy to grow.

OffShoreReversal

[sdinfoserv]

American companies have finally realized
1 -their customers detest trying to have a conversation with someone who doesn't speak English - and that Indian is NOT English.
2- Costs of Indian developers isn't that cheap once you factor administrative, project management and commutation problems within a group on the other side of the planet - again, with people don't understand the cultural nuances of American English speech
. On the positive, companie can't find enough workers in the US paying great salaries. Ride while you can!

RTFA

[rsilvergun]

the job loses were completely due to automation. Trump had nothing to do with it. He let in a record number of H1-Bs this year and is poised to do it next year. If you were expecting a man who relies as heavily on work visas to make money as he does to champion your the cause of American IT, well, I'm not sure you're going to be disappointed because you're paying so little attention that you can manufacture your own reality as you seem to have already done in your post.

Sorry to sound so harsh, but folks need to wake up. Trump is not your friend. He is not, never has been and never will be the friend of the working class. He was always a scam artist and a rich man's son.

Yeah, but that's not what'll happen

[rsilvergun]

China doesn't have the graineries to feed it's people, and they're not gonna get them from India. Wars are fought to steal valuable land. If China goes to war with anybody it'll be the US. More likey they'll just buy us out. Haven't you heard? The aristocracy is global now. They don't fight among themselves on the national stage. Not over anything important. That's for pleebs like you and me. Now get back to arguing over gun control, abortion and whether White Culture is a thing or if Black Lives matter or whatnot and forget about all those pesky economics...

Re: Thank Trump instead

[luis_a_espinal]

The Orange one might have brought tech jobs back to the USA and they might be very expensive, but I know the tech companies can afford these people (ie us) as they make so much money they don't know what to do with it besides stuff it into some island bank account.

You talk just like the type of person who has no idea what the fuck he's talking about. The bulk of jobs being bled in India are the type of IT jobs that led themselves to automation (or when a company is downsizing and reducing opex). No new jobs, you dumb rube.

Salaries seems to be a reasonable destination for the spare cash, and the tech workers will then spend it.

LOL. This is wishful, ignorant thinking. That money goes back to shareholders. Rarely that gets re-invested into operations.

that's far better for the economy than a race to the bottom for the peasantry while our new aristocrats get so rich they couldn't spend it all even if they really really tried (and frankly, looking at Theranos and Uber's continued funding, they're really trying)

Wait, you think that this bleed out in India is somehow going to stop what you just described? I have a bridge to sell you (or a red hat, whatever tickles your fancy.)