IT sector hiring to decline in FY17, according to NASSCOM

July 28, 2016

National Association of Software and Service Companies (NASSCOM) said fresh hiring in the current financial year may be lower than last year as IT companies are facing pressure on margins, besides focusing on automation of jobs.

“Hiring activity in the year before last was 2.20 lakh (new jobs were created in IT sector). Last year, (FY 2015-16) there were about two lakh additions. This financial year, we are expecting it to be on the lower side of that”, NASSCOM President R Chandrashekhar told reporters. Declining to give an exact figure, he said, “I cannot reliably predict what is going to happen. These are trends”.

Explaining about the decrease in hiring activity, he said, fresh hiring is either static or gently declining. It is not as if overall hiring is going down. It is not going to be in the same pace as it was, he said. Chandrashekhar attributed the companies’ focus on automation and pressure on margins would lead to decline in hirings.

“They (IT companies) are adopting higher productivity by reducing the strength and focusing on automation. For a country like India, automation works differently as cost effectiveness on automation is different because our economic levels are different,” he said. While certain jobs within the industry may be automated, those which are off-shored are actually coming in to India.

There is a loss of jobs because of automation within India and also because of a new set of jobs which are coming due to off-shoring and technology changes, he said.”In short, for the next two years, we are still quite optimistic. Our fundamentals are stronger than others (countries)”, he added.