Changing Job Scenario in IT

One of the biggest asset in finance is your earning power the ability to create the net cash flows which can repay the loans. You do not get a house loan, a car loan or a personal loan. What you get is a loan against your FORM 16, that you will be able to repay loan in future.  One of the profession which parents want their children to join is Engineering or IT,others being Medical, Lawyer,IAS. But  being an engineer now is so different from being an engineer 10 or 20 years back. Pink slip or getting laid off is now also happening in India. We’ll touch upon the challenges that IT is facing in India and try to seek answers to Are engineers facing a bleak future? We have also included an article by  former chairman of Microsoft India, Ravi Venkatesan, IT party is over. Now’s the time to reinvent or die.

IT Jobs 

Every parent whose child scores well in Science is hoping that the child gets into IIT or Medical. There are many coaching centres which have opened  up throughout India especially Kota in Rajasthan and online too, to prepare the child for IIT. Chetan’s Bhagat book Revolution 20-20 (pages 48-92) talks about coaching situation in Kota. You can read this at slideshare. An interesting debate on Quora Why do most Indians study engineering?

Since the 1990s there was rapid growth of India’s software development and Business Process Outsourcing (call center and back office). India’s IT and BPO (Business Process Outsourcing) sector reportedly employs up to 3.1 million persons directly and generates some $120 billion in revenue annually, including more than $70 billion in foreign revenue. However things have changed. More engineers, less employable engineers, weak demand in US, layoffs or pink slips are now associated with IT. 

India’s IT sector is increasingly being hammered by the world capitalist crisis, by anemic growth in the US and Europe and increasing competition from other countries with abundant cheap labour. Like many of India’s other industries, its IT sector is also being undermined by the deplorable state of public infrastructure, everything from the speed of transport and reliability of utilities to the low quality of the education provided by all but India’s premier universities and technical institutes. India’s IT and BPO sector has steadily lost business to other Asian countries, especially the Philippines, where salaries are even lower, as well as to Eastern Europe.

Indian economy is not growing at the same rate as the number of engineers.Engineering colleges have been springing up like wild mushrooms in India in the last few years. Their number has gone up from a not too modest 1,511 colleges in 2006-07 to an astoundingly high 3,345 in 2014-15.There is a mismatch in the aspirations of graduating engineers and their job readiness. 97% engineers aspire for a job in IT and core engineering. However, only 18.43% employable in IT & 7.49% in core engineering.  20-33% out of the 1.5 million engineering graduates passing out every year run the risk of not getting a job at all. For those who do, the entry-level salary is pathetically low, and has stagnated at that level for the last eight-nine years, though the prices of everything from groceries to vehicle fuel have shot up during the same period.

Two key industries which hire engineers in India- the IT and ITes and the manufacturing sector- are also hiring a lesser number of them than before. As against 76% of the 1,389 IIT Mumbai pass outs getting campus placements during the 2011-12 session, only a little above 66% out of the total 1,501 could find campus placements in 2012-13 The situation is grimmer for Tier II and Tier III colleges. The huge disparity between start out salary for top colleges and the not so highly sought after ones, which has already been highly pronounced, is expected to widen further.  Meet millions of India’s engineers – unemployed or stuck in unrelated jobs. Recently I read about Uber and Ola drivers earn up to Rs 1 lakh per month Many engineers becoming cab or auto drivers.

Job security is no longer associated with IT jobs. Layoffs is now part of every industry , especially one which is down. For example Nokia shut down it’s manufacturing factory in Chennai making 5000 people unemployed. With airlines criss airline staff got affected. In 2008 due to financial crisis people in financial industry were impacted. Pink slip is a something that many of those in IT might face in future. Mass Layoffs talks about it in detail. Kind of skills needed in the industry change with time. A decade ago needs for IT market were very different from the IT market today. Today there is high demand for jobs like data analysis, eCommerce which are high paying jobs (and high pressure too).  Our article Losing a Job : Why the Layoffs, Managing finances talks about financial moves to help you tide over the period.

IT party is over. Now’s the time to reinvent or die

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