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Last Updated : Jun 13, 2017 10:35 AM IST | Source:

IT cos look to allay fears as employees dread job loss

Employees fear that release from ongoing projects to a bench awaiting deployment to a new client could mean a layoff.

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Even as the news of mass layoffs in the information technology sector continues to add to the worry of workers, large employers are looking at ways to speak to them and allay fears about job losses.

“There is greater focus by IT companies to send effective internal communications- more townhalls, greater focus on talking about reskilling. Every company has some sort of internal reskilling platform going on,” said Sangeeta Gupta, Senior Vice President at industry body National Association of Software and Services Companies (Nasscom).

According to Nasscom, India’s USD 155 billion IT industry added 1.7 lakh new jobs in the last fiscal, with a total employee base of about 39 lakh.


There have been reports of over 50,000 people in the industry being laid off this year at some of India’s biggest IT companies such as Infosys, Cognizant, and Tech Mahindra. As a result, employees have hit a panic mode.

Benching could mean a layoff

Indian IT companies have consistently denied mass layoffs, but reports of employees being asked to leave is impacting optimism.

“The experience of living with the possibility of redundancy, insecurity of job and watching others leave, has become part of the working experience of many employees which is definitely impacting the employee morale,” said Alka Dhingra, general manager at IT staffing firm TeamLease Limited.

Some employees Moneycontrol spoke to echoed similar sentiments. “People are scared, the market is bad, and nobody is asking to be released from ongoing projects, which was common practice earlier. We’re afraid release from a project as it could mean being laid off,” said an employee at Tech Mahindra, who did not wish to be identified.

The company has also made its employee rating standards stricter, and plans to lay off the employees with lowest rating, said another employee at the company.

An employee at HCL Technologies said the company is looking to reduce its bench strength.

Organisations are looking to nearly eliminate “bench”, or a layer of employees who are not assigned to projects, and kept ready for upcoming projects. “Just-In-Time hiring is becoming the norm now,” said TeamLease’s Dhingra.

Indian IT firms are facing the slowest growth in a decade due to headwinds from increasing automation, changing technology and slowdown in client spending. Protectionist policies in some of the IT sector’s largest markets such as the US, UK, Singapore and Australia have affected the offshore model.

The US and UK account for over 60 percent of the Indian IT services revenues.

All major IT companies have denied reports of mass layoffs, and continue to say whatever dismissals happen are business as usual.

“TCS is not doing any mass layoffs so no such concerns have come up,” a TCS spokesperson told Moneycontrol, when asked about the steps being taken to mitigate employee concerns.

Infosys' Chief Operating Officer UB Pravin Rao told Moneycontrol last week that there were no mass layoffs at Infosys. Tech Mahindra has also denied any mass layoffs in the past.

Wipro and HCL Technologies did not respond to a request seeking comment for this story.

'IT cos need to be open with employees'

According to Ganesh Natarajan, former chief executive officer at Pune-based software company Zensar Technologies, there is a need for IT organisations to accept that there is a real issue in the industry.

“The technology is changing, the growth is low, there is tremendous amount of automation, artificial intelligence etc…so there will be some churning…[but] employers should tell employees that anyone who is willing to reskill themselves, are willing, and accept the pain that is required to learn new technologies, will remain relevant,” he told Moneycontrol.

The key for companies, according to Natarajan, is to “be very open, try not to react through press interviews, and be more open with their employees. They should have a conversation about what are the areas where they see more business happening”.

According to some estimates, about 3 lakh engineers graduate in India each year. According to an Aspiring Minds study, only about 14.67 percent engineers are employable for an IT services company.

“The clear message is that if you have the right skills, there are enough and more jobs for you,” said Nasscom’s Gupta.

Teamlease’s Dhingra said the most impacted by this cycle of churn would be low skill level IT employees. “Skills like cybersecurity, data analytics, software-as-a-service, artificial intelligence, full stack, robotics, cloud, mobility solutions and digital technologies are the major areas of job creation in future,” she added.

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First Published on Jun 13, 2017 10:35 am
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