Life after layoff: The human dimension of India’s IT woes

By Avik ChandaOne of the biggest economic shockwaves thus far this festive season has been the spate of retrenchments announced in the large IT firms, such as Cognizant Technology Solutions (CTS) and Infosys. The US-based CTS, which has 75% of its workforce based in India, recently registered a 4.2% increase in its Q3 profits, as…

Life after layoff: The human dimension of India’s IT woes

By Avik ChandaOne of the biggest economic shockwaves thus far this festive season has been the spate of retrenchments announced in the large IT firms, such as Cognizant Technology Solutions (CTS) and Infosys. The US-based CTS, which has 75% of its workforce based in India, recently registered a 4.2% increase in its Q3 profits, as compared to last year. But this has come at a price. On November 1, the company announced that it was closing down its content moderation business, resulting in job cuts for an estimated 12,000 personnel.
Within days of this came in reports that Infosys would be shedding between 4,000 – 10,000 of its people, across grades. This translated to 2.5% of personnel at the junior and mid-levels, whereas 50 of the existing 971 title holders in the management cadre, including associate, senior and executive vice presidents, would also come under the anvil. As with CTS, the emphasis is on mid and senior-level executives, a big blow to the IT sector, which for two decades has been at the vanguard of India’s economic growth. While “cost restructuring” is the placeholder term typically used to rationalize retrenchment, it’s not difficult to see that there’s a connection between layoffs and efficiency achieved through technological means, primarily AI and automation.
Shocking as this is, such a scenario has been heralded. In 2017, a report by McKinsey & Company indicated that up to 6 Lakh personnel working in IT firms in India might lose their jobs over the coming 3 years, to AI and automation. McKinsey’s prediction was supported by US-based firm HFS Research, which projected that around 7 Lakh ‘low skilled’ professionals in IT and BPO industries in India could lose their jobs to automation and AI, by 2022.
The cost of all this, in terms of the human dimension, is staggering. The immediate casualties are of course the tens of thousands (soon to be lakhs, if McKinsey’s prognosis proves accurate) of employees losing their jobs in the continuing run of retrenchment. Many of them are at their mid-or-higher career levels, with relatively low lateral training on skills relevant for other domains or industries, and so find it all the more difficult to eith
Read More From Publisher