Indian software industry has a long history to go back to. When times were good, the software industries like Wipro, Infosys and Tech Mahindra went on a massive hiring spree. These companies, today, are in the process of laying off thousands of employees across various locations and department levels. This move has come after the growth in the Indian software industry has slowed down due to automation, costlier visa regime and the changing business policies. Software companies are now hiring fewer employees and firing employees, than ever before.
Infosys is expected to lay off more than 3500 senior level and mid level employees. Employees in the technical level, project managers and delivery managers have already been asked to quit. Out of a total 2 lakh employees at Infosys, the layoffs will be carried out in a phased manner. India’s third largest software services firm, Wipro, has already laid off around 600 employees and this number could go as high as 2000. Wipro mentioned that the lower rate of revenue growth has led to the layoff of many employees across different levels. Tech Mahindra is expected to lose about 8000 employees from the software division. The layoffs in Tech Mahindra will be the biggest in the company’s history. Cognizant also unveiled a separation plan which will lay off about 1000 employees from the company. It will be difficult for individuals to look for another job since technology is going obsolete.
The trouble in the Indian IT sector started after the President Trump’s ‘Buy American, Hire American’ campaign. The norms for H-1B visas were tightened and this had a major impact on the Indian Industry. With a decline in the Visas applications and a huge decline in the US remittances, it is expected that the software industry will go through a major blow.
Apart from the visa regulations, the overall growth of the industry has slowed down. The expected growth rate for the industry was 12%, which has gone down to 8% this year. Further, the use of robotic automation has entered in every field, which has made technology obsolete. IT sector is cutting down the human intervention by almost 50%, which has rendered thousands of individuals redundant and their skill sets obsolete. Companies under pressure will be forced to look at their workforce pyramids and try to cut down on the losses. The easiest way for a company to reduce the losses, is by laying off employees in a phased manner. Industry experts mention that there will be more layoffs in the future. A huge number of employees will become unemployed due to the major shift in the IT sector. The tighter visa rules across the Countries has also made it difficult to cut down on the costs. The costs are increasing and the customers are not willing to pay more. This could be seen as a major shift in the IT software industry, which was once a pioneer in the generation of jobs and bringing higher revenues for the Country.