IT sector slows down hiring to cut costs
The information technology sector in the country witnessed steep decline in hiring activities as most companies embraced cost-cutting measures to tide over uncertain economic conditions.
The information technology sector in the country witnessed steep decline in hiring activities as most companies embraced cost-cutting measures to tide over uncertain economic conditions, say experts. "Hiring activities have seen a dip of 29% in IT and ITeS sectors in May 2012 from the preceding month," MyHiringClub.com CEO Rajesh Kumar said.
However, he said that other industries have increased recruitment activities by 13-15 per cent in May as compared to April. HR experts attributed the sluggish job scenario in the IT and ITeS space to cost cutting move and expects that the same trend would continue for few months.
"Recruitment activity in IT decline, but some skills still in big demand. Cost cutting and project outsourcing is one of the reason for decline in hiring activity in this sector," Sat-n-Merc Manpower Consultant director Prachi Kumar said about the job prospects in the IT sector.
She further said, "Uncertainty in economic scenario and political conditions have also affected hiring activities. We are expecting the same trend will continue for few more months."
Echoing the view, Rajesh Kumar said, "A weaker rupee would help the Indian software exporters with higher repatriated earnings, as the largest proportion of their revenues comes from the US. But still IT companies had slow down their hiring activities in the month of May 2012. The major reason behind this is companies are going to reduce the bench size and award more jobs on contact basis to save costs for future inflation," he added.
In terms of geographical analysis, Bangalore has seen a slump of 31% in hiring from previous month and a decline of 18% from the year-ago period. Besides, Delhi has witnessed a drop of 16% in May compared to April followed by Chennai (17%), Mumbai (14%) and Hyderabad (12%).
"As we had expected in beginning of this financial year hiring is not on the same pace. Last month was not overall good for hiring activity in the IT sector as the industry is more scared about their profitability in this financial year,"said Psyche Panacea director Vikas Vats.
"They had started doing cost control via several activities and that the reason several organisations from this industry had put their openings on hold till further notice. Might be this will be continue for some more period."