IT employees in India, especially mid-to-senior level staff, stand the risk of losing their jobs as most firms are likely to lay off over 5-8 per cent of total workforce in upcoming quarters.
- IT firms are planning further job cuts in India to streamline costs
- IT employees, especially mid-to-senior level staff, stand the risk of losing their jobs
- Each large IT firm may lay off up to 20,000 people over the next few quarters
India’s vast Information Technology (IT) domain is going through a rough period as most players look to streamline costs and localise their businesses in the US.
IT employees in India, especially mid-to-senior level staff, stand the risk of losing their jobs as most firms are likely to lay off over 5-8 per cent of total workforce in upcoming quarters, reported Business Standard. That translates to about 10,000-20,000 employees in each large firm.
Quoting experts, the report says that rising pressure on target margins due to heavy discounts in core business, increased hiring for US and the emergence of new technology are few reasons behind cutting jobs.
An expert told the publication that employees working as project managers with a salary of Rs 20 lakh to Rs 40 lakh face maximum risk of losing their jobs. It could further take a toll on the high unemployment rate in the country over the next few quarters.
It is worth noting that top companies like Cognizant and Infosys have already made their intentions about job cuts clear. Cognizant plans to streamline its total employee pool by over 12,000 employees while reports claim that Infosys will let go of at least 10,000 employees.
Cognizant CEO Brian Humphries explained that the company is trying to correct the “employee pyramid” which has been distorted in the past. The company said it would increase its graduate hiring by 30 per cent and cut down of mid-to-senior level staff. Cognizant is aiming to reduce its operation cost by $350-$400 million.
On the other hand, Infosys, which is seeking to cut costs to the tune of $100-$150 million during the financial year shares a similar goal. Both IT majors also highlight the fact that they are hiring more in the US to aggressively localise operations.
However, more hiring in the US has taken a toll on IT firms as the cost of such a move is higher than hiring staff in India. This is one of the core reasons why top tier IT firms are letting go of employees working in India.