January , 2020
IT sector boosts employment after sluggish growth
11:50 am

Aritra Mitra

India is the largest off-shoring destination for Information Technology (IT) companies across the world. The Indian IT and business process management (BPM) industry had over 15 million directly and indirectly employed personnel during the 2017 fiscal. The IT-BPM sector has grown over the years and accounts for more than 30% of the global outsourced BPM market. The sector also contributed around 8% to the GDP of the country in the 2017 fiscal. However, the industry laid off over 56,000 people between 2017 and 2018.

According to an IT source working abroad, most Indian IT companies provide offshoring services as the revenue is derived from an on-shore/offshore model combination. The source told BE, “Most of the value added services in IT is done onshore processes and then a repetitive kind of work is delivered through centres in India. The onshore teams on software development projects manage day to day client and stakeholder engagement running workshops. Offshore teams are largely responsible for functional and technical configuration and unit testing activities.” 

Centre for Monitoring Indian Economy (CMIE) data suggests that India lost 11 million jobs in 2018, while unemployment in the country was pegged at 6.1% in 2017-18 by the NSSO’s Periodic Labour Force Survey (PLFS). Experts feel that India’s IT industry is one of the largest private-sector employers in the country and might be able to lift the job market, going by its current hiring momentum.

Though there is a sluggish pace of job growth across sectors, the momentum of hiring in the $167-billion Indian software services industry is showing signs of a steady pickup. In the recently concluded 2018-19 fiscal, the country’s top two IT-services companies like TCS and Infosys hired over half a lakh employees. The Mumbai-headquartered TCS had a net addition of 29,287 employees while the Bengaluru-based Infosys added 24,016 software professionals till March, 31, 2019. At the close of the 2019 fiscal, TCS’s total employee base stood at 4.24 lakh and for Infosys the figure was 2.28 lakh.

Over the past five years, the Indian IT outsourcing industry has witnessed sluggish growth in traditional IT businesses such as application development and maintenance, verification of software and business process outsourcing. These still account for about 60-70% of revenue for Indian IT majors. Meanwhile, revenue from digital businesses such as cloud computing, IoT, analytics and mobile applications is growing at 20-30% year-on-year.

According to a TeamLease Services report on ‘IT hiring projections for 2019’, the Indian IT industry is expected to add around 2.5 lakh new jobs this year. The report noted, “Jobs roles in IT have become multi-dimensional and the industry needs to take a generation leap in 2019 when it comes to re-skilling. To facilitate advanced skilling, it is also crucial for organisations to hire high skilled and technologically sound HR representatives as well as development specialists who can hire the right talent. Investments in IT re-skilling will increase by around 20% in 2019.”

A potentially strong area of employment will be data analytics, an increasingly crucial field across industries. Alka Dhingra, General Manager, TeamLease Services recently told media, “The overall job landscape in the IT sector will undergo radical changes over the next few years and certain job roles will continue to see increased demand. Some of the areas wherein positive growth in hiring is expected are mathematics, architecture and engineering-related fields.” IT majors such as TCS, Infosys, Wipro and others are preparing its staff to be future-ready. According to TCS sources, its employees logged over 52 million learning hours in FY19.

Debaditya Bakshi, a Cognizant employee, told BE, “The IT sector has its own training programmes which employ people from various educational backgrounds, very easily train them with particular set of skills and get them working on required projects.” He added, “The necessity of learning newer skills for the employees sometimes makes it difficult for them to survive in IT because technology is ever changing. So there is a constant pressure or urge of up skilling and cross skilling.”  

According to industry sources, the Indian economy will continue to provide good oppurtunities in the IT sector. An industry source stated, “There is a growing gap in the number of students opting for IT related courses and employability. It is an often misunderstood notion that passing a certain course would automatically make someone eligible for a job. There is a lot of difference between completing a university course and getting employed. Courses should make students industry ready.”


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