1. IT job cuts fears: Why all is not as bad as you may think

IT job cuts fears: Why all is not as bad as you may think

Indian IT sector employment prospects, both in the near and long-term are expected to be broadly positive and encouraging for the future, says government.

By: | New Delhi | Updated: May 24, 2017 11:49 AM
it job cuts, it jobs layoff, it job crisis india, it jobs india, it job crunch, it job market crash, it sector india Government says employment prospects in IT sector is robust. (Reprentative image/PTI)

As fears of massive job cuts in the Indian IT sector looms large, Ministry of Electronics and IT, Government of India, has come out with an explanation showing that employment prospects in the industry are actually “robust” for the next many years. In a release, the ministry has also rubbished media reports raising fears about IT job cuts, saying they are “highly exaggerated and unfounded.”

“Indian IT sector employment prospects, both in the near and long-term are expected to be broadly positive and encouraging for the future,” it says.

IT companies in India currently serve around two-third of the fortune 500 companies and they have created around 40 lakhs direct jobs in the country. In a bid to “present an objective and realistic potential of the employment scenario”, the Ministry has relied upon its own feedback, projections by NASSCOM, and some renowned independent organizations and consultants.

According to Nasscom, around 2.5 to3 million new jobs are expected to be created by 2025. In Financial Year 2017, the sector has created 1,70,000 new jobs. In the last three years, IT industry added 6,00,000 new jobs and now boasts of a total 3.9 million workers.

The release quotes a TeamLease analysis for 2017-18 which says that IT sector hiring sentiments is “positive and is up by 4% in October 2016 to March 2017” when compared to the previous six-month period.

As per TeamLease, e-commerce and technology startup sector hiring sentiments have increased by 2%, with projected 14.94% job growth.

According to recruitment and staffing firm Randstad, a cumulative growth rate of 9% in the IT/ITeS job market is expected. The ministry said that Indian technology startup sector will offer strong and growing employment prospects to Indian IT professionals.

NASSCOM says that in 2016, Indian technology startups provided jobs to 95,000 to 100,000 IT professionals, across more than 4,750 startups (including e-commerce and hyperlocals).

The release says that India’s domestic IT market would continue to offer strong prospects for industry growth even if global markets face challenges. Moreover, India’s domestic IT/BPM sector is expected to grow at 8.5% from $35 billion in 2016 to $37 billion in 2017.

Jobs would also be created by some other sectors within the IT industry under Digital India. The ministry reports that around 10 lakh local-level employment for village-level entrepreneurs have been created by the CSCs. At present, total direct employment in IT/ITES sector is 4 million, while the indirect employment is 1.3 crore. Around 50% of total jobs created by domestic IT/ITES sector has been generated by state-owned Software Technology Park of India (STPI). A large number of STPIs are located in Tier-I and Tier-II cities.

Besides, the government has come up wit an India BPO promotion scheme to provide jobs to 1.45 lakh people, mostly in small towns. Over 48 thousand BPO seats will be created in 2017-18. These BPOs have been set up in cities like Imphal, Guwahati, Siliguri, Patna, Muzaffarpur, Samastipur, Gazipur, Unnao, Amravati etc. The government has also started a separate Northeast BPO promotion scheme with 5000 seats, with an employment potential of 15000 persons.

In the last 30 months, 72 new mobile manufacturing units started operations in India, providing 1 lakh direct and 3 lakh indirect jobs.

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