The hit job on IT job losses

Of late we have been flooded with grim news predicting gloom and doom for India’s IT industry. Robots, automation, Donald Trump you name it, a variety of forces working together to devastate the bottom lines, destroy growth and render thousands jobless. Or so we were told. As usual our clever journalists can always find “anonymous” sources or perhaps even the odd genuine geek given the pink slip. In an industry that employs hundreds of thousands (TCS alone has almost 400k), coming across a few should not be that difficult.

But the key questions are:

  1. Are the job losses much more severe this year as compared to earlier years?
  2. Are they really due to the reasons mentioned in these scary reports?
  3. Is the paranoia warranted? Or is there a deeper agenda behind it?

Based on statements, articles and interviews by knowledgeable people in the industry (not our corrupt know-all “journalists” many of whom do their research inside envelopes) we can gleam the following facts:

  1. Technology changes all the time and workforce skills have to evolve, adapt and change. This is nothing new in the IT industry or for that matter any industry these days. After all, our industry has survived various other doomsday prophecies – end of Y2K boom, dotcom bust, 2008 crisis and so on.
  2. Of course, some unfortunately need more time or may may have missed the bus this time around.
  3. This requires action by every stakeholder – the academia (syllabus revisions, industry interactions etc), the industry (re-training, proactive counseling, partially paid sabbaticals for re-boot of skills etc.), Government (fiscal incentives, create learning infrastructure, particularly in smaller towns where skill gap and thus job losses can be higher)  and most importantly the individual (constantly learn, adapt and never feel secure)
  4. Net net the industry is hiring, not firing.  TCS has added more than 20,000 this year, not reduced. Same goes for many other tech firms. NASSCOM says Indian IT hired about 117k jobs in 2016-17. Cognizant also plans to continue to hire and its “firings” are nothing abnormal this year (Link 8).
  5. There is no denying that focus on low end, repetitive tasks and wage arbitrage is bad. Industry’s profits should come from innovation and intellectual property not cheap programmers and flogged workers. On this front there is a genuine case for gripe.
  6. As Mihir Sharma points out (Link 7), changes proposed by Trump administrators may not necessarily be bad for Indian IT professionals. After all, US companies are much better employers! This may force Indian IT firms to change their behavior too.
  7. A country our size cannot depend on the visa policies of another country to ensure its prosperity. Reforms to H1B visa in the US which is long overdue or other advanced Western countries are eminently sensible from their perspective and should be seen as an opportunity, not crisis.

Modi Government – be more proactive

Just as he did with Indian Bank chiefs, perhaps Narendra Modi should initiate a round table discussion with the IT industry heads. Agenda should be pointed, focused and simple:

  1. What specific short and medium term steps can the government take to help? Here focus should be on clearly identified, do-able tasks, not pie in the sky wish lists. What is NOT needed is funding schemes that go nowhere and take years to produce results. India cannot afford that.
  2. Why are we not producing Google’s and thousands of small startups in big data, analytics, cloud etc etc. that US produces week after week, year after year, ironically many of which have Indian talent at the very top? Target here should be identify specific red tapes, speed bumps and cut them down.
  3. Instead of hiring “unemployable” graduates and spending money training them (often at site to the chagrin of the customers) what can Government, industry and Education ministry do to quickly re-tool our colleges? It is not as if nothing is being done but surely results are disappointing so it is worth a re-look.

Somewhere a beginning has to be made to usher in a new future for our IT Industry and keep its powder dry for endless battles in the tech arena. Whining, scare mongering and senseless headlines to score web hits is not the answer.

Links

(may disappear or change over time, valid at the time of posting)

  1. http://www.thehindubusinessline.com/info-tech/chatter-over-layoffs-in-it-industry-highly-exaggerated-tcs-president/article9718629.ece
  2. http://profit.ndtv.com/news/tech-media-telecom/article-why-6-lakh-it-professionals-are-at-risk-of-losing-jobs-1693403
  3. http://profit.ndtv.com/news/tech-media-telecom/article-infosys-defers-pay-hikes-says-no-planned-layoffs-read-letter-to-staff-1692632
  4. http://economictimes.indiatimes.com/tech/ites/indian-it-in-the-sweet-spot-industry-to-double-its-jobs-by-2025/articleshow/58885691.cms
  5. As TCS Chief (now Tata Group honcho) Chandrasekaran points out, global IT spending is growing and that too more in services. This puts India in a “sweet spot”.
  6. http://www.hindustantimes.com/business-news/indian-it-industry-still-hiring-reports-of-layoffs-wrong-nasscom/story-ZlQ8RATcuKshdnc19X9m5L.html
  7. http://www.rediff.com/business/column/column-indian-it-is-dead/20170417.htm
  8. http://www.business-standard.com/article/companies/local-hiring-to-go-on-cognizant-president-tells-techies-fearing-layoffs-117052501075_1.html