Nasscom predicts 20% fall in IT hiring in FY17

Software industry body says major IT companies are focusing on more automation
A recent report by Centrum Broking had said that the big five software exporters TCS, Infosys, Wipro, HCL and Cognizant - together added net 24 per cent fewer employees in 2015 at 77,265, due to their automation drive. The massive plunge in net additions was led by the Chennai-based Cognizant whose hiring was down 74.6 per cent from 2014

Hyderabad: Here is a bit of bad news for those who are looking to enter information technology sector as IT professionals this fiscal. Software industry body Nasscom of strong view that IT hiring will fall by 20 per cent during the current financial year as major players like TCS and Infosys are focusing on more automation. Therefore, they will need less number of new recruits, the industry body feels.

Last June, the IT industry body had predicted that the $143-billion domestic software industry might hire 2.75 lakh in 2016-17, up from about 2.3 lakh during last fiscal. "I think we are still maintaining that overall industry will grow at 10-11 per cent this year. The hiring will not be as linier as we have seen in the past. The digital world leads to automation, automation leads to relatively lesser recruitments.

Secondly, digital also means to get closer to the customer,” C P Gurnani, Chairman, Nasscom, said on the sidelines of 'Global In-house Centres Conclave' event here. Gurnani, who is also the Chief Executive Officer of TechMahindra, however said the drop in recruitment would not impact the revenue growth.

"I think you will see recruitments slowing down compared to last year. I think it will be like 15-20 per cent relatively lesser in headcounts. But it will not impact the revenues," Gurnani explained. A recent report by Mumbai-based Centrum Broking had said that the big five software exporters TCS, Infosys, Wipro, HCL and Cognizant - together added net 24 per cent fewer employees in 2015 at 77,265, due to their automation drive.

The massive plunge in net additions was led by the Chennai-based Cognizant (down 74.6 per cent from 2014) and HCL (down 71 per cent) which have been very keenly focusing on improving utilisation rates through automation, Centrum said. TCS had earlier this week announced that it too would be hiring less number of freshers.

During the fourth quarter, TCS had added only 22,576 to take its total workforce to over 3.53 lakh, but Chief Executive N Chandrasekaran said the gross hiring in this fiscal will be much lower than 90,000 in 2015-16 on lowering attrition, better productivity and deepening automation drive.

Replying to a query, Gurnani said the falling oil prices may have some impact on the domestic IT industry as the oil-dependent economies are reeling under pressure. But he was quick to say that the impact would be minimal. "If I look at my member companies, and our global innovation centres, very few of them are from West Asia, while about 60 per cent of our revenue comes from America, and 25 per cent from Europe.

So I think the impact will be minimal," Gurnani said. On the impact of US elections outcome, Gurnani said some of the US senators should answer if they need India more or India needs US more. "I think we need each other. There will not be much impact of US elections on our IT industry," he said. (With PTI inputs)