Head Hunters In­dia Founder-Chair­man and Man­ag­ing Di­rec­tor K Lak­sh­mikanth

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Ex­ec­u­tive search firm Head Hunters In­dia says the job cuts in IT sec­tor will be be­tween 1.75 lakh and 2 lakh an­nu­ally for next three years due to un­der­pre­pared­ness in adapt­ing to newer tech­nolo­gies. "Con­trary to me­dia re­ports of 56,000 IT pro­fes­sion­als to lose jobs this year, the ac­tual job cuts will be be­tween 1.75 lakh and 2 lakh per year in next three years, due to un­der­pre­pared­ness in adapt­ing to newer tech­nolo­gies," Head Hunters In­dia Founder-Chair­man and MD K Lak­sh­mikanth told PTI, analysing a re­port sub­mit­ted by McKin­sey & Com­pany at the Nass­com In­dia Lead­er­ship Fo­rum on Fe­bru­ary 17. McKin­sey & Com­pany re­port had said nearly half of the work­force in the IT ser­vices firms will be "ir­rel­e­vant" over the next 3-4 years. McKin­sey In­dia Man­ag­ing Di­rec­tor Noshir Kaka had also said the big­ger chal­lenge ahead for the in­dus­try will be to re­train 50-60 per cent of the work­force as there will be a sig­nif­i­cant shift in tech­nolo­gies. The in­dus­try em­ploys 3.9 mil­lion peo­ple and the ma­jor­ity of them have to be re­trained. "So, when we an­a­lyse th­ese fig­ures, it is clear that 30 to 40 per cent of the work­force can­not be re­trained or re-skilled. So, as­sume that half of this work­force can con­tinue to work on old skills, then bal­ance will be­come re­dun­dant. "So, the num­ber of peo­ple who will be­come re­dun­dant in the next three years will be about five to six lakhs. This will work­out to, on a av­er­age, be­tween 1.75 lakh to 2 lakh per year for next three years," Lak­sh­mikanth ex­plained. How­ever, he said job cuts will not take place in ma­jor cities like Mum­bai or Ben­galuru, but cities like Coim­bat­ore or a few re­mote places, he said. Lak­sh­mikanth fur­ther said the IT ser­vices in­dus­try is pass­ing through an un­cer­tain time as the growth in dig­i­tal tech­nolo­gies like cloud-based ser­vices is hap­pen­ing at a much faster pace and

the com­pa­nies are com­bin­ing learn­ing of some of the new tech­nolo­gies and reskilling. "Be­cause of the chang­ing tech­nol­ogy, the most af­fected will be the pro­fes­sion­als aged 35 and above, for it would be very dif­fi­cult for them to get jobs," Lakhsmikanth said. Asked if it is fair to blame US Pres­i­dent Don­ald Trump's pol­icy for job cuts, Lak­sh­mikanth said it is not fair be­cause he has ful­filled the prom­ise af­ter win­ning the elec­tions. "How can we blame Trump, for he has ful­filled the elec­tion prom­ise of giv­ing jobs to lo­cal peo­ple in­clud­ing IT pro­fes­sion­als by tight­en­ing H1-B visa norms, which were be­ing mis­used by com­pa­nies by pay­ing less to for­eign pro­fes­sion­als work­ing in US. It is for com­pa­nies to tackle the sit­u­a­tion, and such sit­u­a­tion they have un­der­gone in pre­vi­ous years. It is not new for them. They know to tide over it," he said. Lakhsmikanth also said it is not fair even to tar­get the In­dian gov­ern­ment as the IT in­dus­try grew on its own in In­dia, but at later stages re­spec­tive state gov­ern­ments and cen­tral gov­ern­ments pro­vided them fa­cil­i­ties like land or cre­at­ing spe­cial eco­nomic zones, among oth­ers. The gov­ern­ment how­ever sought to al­lay fears of large scale lay­offs by tech firms in In­dia say­ing the IT sec­tor re­mains "ro­bust" and is, in fact, mov­ing be­yond plain-vanilla back of­fice ser­vices to highly skilled jobs. IT Sec­re­tary Aruna Sun­darara­jan said the IT com­pa­nies have as­sured that there is "noth­ing un­usual" this year and de­ci­sion to not re­new some con­tracts were part of the an­nual ap­praisal process. "Some of the com­pa­nies which have been named (as un­der­tak­ing job cuts) have clar­i­fied that there is noth­ing big this year," she said on the side­lines of Broad­band In­dia Fo­rum event. Over the past few weeks, there have been re­ports of lay­offs across the IT sec­tor. Tech ma­jors like Wipro, In­fosys, Cog­nizant, and, more re­cently, Tech Mahin­dra have ini­ti­ated an­nual per­for­mance re­views, a process that weeds out bot­tom per­form­ers or non per­form­ers. This has added to fears that thou­sands of em­ploy­ees in the sec­tor could be shown the door over the next few weeks. "As part of an­nual ap­praisals, they may not be re­new­ing con­tract of some peo­ple but it is ab­so­lutely in­cor­rect to as­sume that sud­denly this year a large num­ber of jobs are be­ing shed," Sun­darara­jan said. Stat­ing that the In­dian IT sec­tor will grow at 8-9 per cent this year, the IT Sec­re­tary ex­uded con­fi­dence that the in­dus­try will con­tinue to hire in large num­bers as new tech­nolo­gies like dig­i­tal pay­ments, cy­ber se­cu­rity, big data and cloud gain trac­tion. "Any re­port that is in­ter­pret­ing this change as a large scale loss of jobs in the IT sec­tor would be fac­tu­ally mis­lead­ing and in­cor­rect," she said. The IT Min­istry's views echo with that of in­dus­try body Nass­com, which has been on an over­drive to as­sure the tech fra­ter­nity that the sec­tor con­tin­ues to be a "net hirer" with over 1.5 lakh peo­ple be­ing em­ployed on net ba­sis every year. In a state­ment, Nass­com had said that re­ports of mass lay­offs were in­cor­rect, and that work­force re­align­ment, linked to per­for­mance ap­praisal pro­cesses, were a reg­u­lar fea­ture every year. Sun­darara­jan to­day said that the IT sec­tor will con­tinue to hire and has added five lakh jobs in the last 2.5 years. The is­sue needed to be looked at "holis­ti­cally", she noted. The re­ports of large scale lay­offs have com­pounded the worry in the in­dus­try, as the sec­tor is al­ready bat­tling chal­lenges in the busi­ness en­vi­ron­ment and stricter work per­mit regime in coun­tries like the US, Sin­ga­pore, Aus­tralia and New Zealand.

Head Hunters In­dia Founder-Chair­man and Man­ag­ing Di­rec­tor K Lak­sh­mikanth

IT Sec­re­tary Aruna Sun­darara­jan

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