Last week, one headline saw a "mayhem" in India's IT industry. This week, there is one talking of a "digital tsunami" that will wash away jobs in the country's darling sector.
If you are a casual observer, a sense of panic is natural. We can expect two things in the coming days. One is a definite move towards downsizing or right-sizing in India's IT giants that were for the past two decades hiring by the thousands every quarter. The other is a series of alarmist reports that will see the decline of India's IT sector. The truth is more nuanced than simplistic statements.
The managing director of Head Hunters, Kris Lakshmikanth, has stuck his neck out by predicting as many as 600,000 job cuts in Indian software service companies over the next two to three years. Worse, he is pessimistic about retraining staff. He says as many as 2.4 million of the 4.0 million employees would have to be re-trained and this has limitations because a fourth of them cannot be re-trained. I am not sure I agree, and even if he is right, the people losing jobs would be less than 15 percent of the total work-force.
The trick is to look beyond so that alarmism gives way to realistic expectations because while job cuts are real, job creation is also happening. In plain language, don't confuse a wave of reinvention in the industry with a one-way street of retrenchment. Some companies may be in trouble but it would be unwise to extend the logic to the entire technology sector. Here's why.
Even as the head hunter was sounding a note of caution, headlines about the Wannacry ransomware hitting at least 74 countries were making people sit up, and India is no exception. Cybersecurity in an interconnected world demands various levels of alertness and skills -- and each one spins jobs on the go.
Two years ago, NIIT and PriceWaterhouseCoopers signed an agreement for cybersecurity education with the prediction that this market will grow from $1 billion to $35 billion over the next decade. Another report last year put the numbers at much higher levels, and cited Cisco to say that as many as 6 million cybersecurity jobs may be up for grabs worldwide by 2019.
Some of these reports are extra rosy -- just like some other reports are extra alarmist.
Cybersecurity alone is not creating jobs. Emerging digital age companies such as Amazon and Facebook are creating their own demand for techies of various shapes and sizes -- and they may not all be in-house. What we will see in such a landscape is a re-invention of the industry.
No doubt big companies such as Infosys, Tata Consultancy Services and Wipro will be subject to some shocks as their decades-old formula of cutting big deals with big Western companies and hiring freshers by the thousands will give way to a measured approach. Everything from US president Donald Trump's visa policies to software automation are giving a wake-up call to the old-world giants.
As the former head of human resources at Infosys, Nandita Gurjar says, the trade-off in the immediate sense is more likely between salary hikes and job retention. But a slowdown in job growth or performance-linked exits in a measured down-sizing exercise should not be confused with large-scale off-with-their-heads retrenchment.
There are definitely pains ahead for the IT services industry but that is only a part of the larger technology sector. Fresh graduates betting on secure long-term jobs in giant companies are the ones who should be waking up fast. But reinvention should not be confused with an industry sunset.
(The author is a senior journalist. He tweets as @madversity)
Updated Date: May 15, 2017 12:04 PM