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IT industry slows, Indian companies ready for large layoffs

Source | Timesofindia.indiatimes.comBY: Shilpa Phadnis & Ranjani Ayyar|

BENGALURU/CHENNAI: Large IT services companies are all in the process of laying off employees on a scale not seen since the 2008-10 downturn. Those taking the hit first are mid and senior level professionals, those with 10 to 20 years of experience, but the expectation is that lower level employees too will be hurt later in the year, as growth in the $150-billion industry slows far more than anticipated and companies move towards hiring more in the US. The situation is worsening to a point where affected employees are beginning to approach labour unions to take up their cause.

Cognizant last week announced a voluntary separation programme for directors, associate VPs and senior VPs. Some 1,000 executives are expected to go. The company, one of the top performers in the industry, is expected to eventually cut at least 6,000 jobs+ , or 2.3% of its total workforce. Last Thursday, ten Cognizant employees, through the Forum for IT Employees, filed a petition with the assistant commissioner of labour arguing that they were being forced to sign voluntary resignation letters.

At Infosys, nearly 1,000 employees in job level 6 and above (group project managers, project managers, senior architects and higher levels) are expected to be asked to leave. Managers at these levels have been asked to identify, in terms of performance, the bottom 10% of their reportees.

Three weeks ago, Wipro + CEO Abid Ali Neemuchwala mentioned in an internal conference call that if revenues don’t grow, around 10% of employees would be let go off this year. The product engineering team is likely to be one of the big casualties. Wipro ended the last fiscal year with 1.81 lakh employees.



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