The IT sector in India has witnessed significant growth, with approximately 51 lakh individuals employed as of March 2022. However, the industry is currently undergoing temporary regulatory changes, leading to the layoff of contract employees. Additionally, the employment rate has slightly declined, and the number of contract jobs filled by vendors in Indian companies has reached 14 lakhs, with a notable presence of women in these roles.
Impact of IT Industry Changes in India
The situation in the Indian IT industry is becoming critical. Companies have now made another tough decision by laying off several employees, including software developers and tech professionals. In just the last four months of this new year, a total of 3,600 outsourcing contract jobs have been eliminated by domestic IT companies. Currently, there is a wave of unrest due to the ongoing contraction of contractual employment. We are now aware of these details.
The current situation in the IT industry has created a crisis for working professionals. Uncertain and unstable employment conditions are evident. Until yesterday, domestic IT companies were laying off executives and tech professionals, eliminating outsourcing contract jobs. In the contract staffing segment of the Indian IT industry, approximately 6% of employees lost their jobs in the January-March quarter of the previous year.
IT companies adjust their workforce according to project requirements and temporarily hire flex staff. The number of employees heavily reduced in the October-December quarter of the previous year, causing a significant decline in the workforce during the March quarter of the new year, as reported in the submission. Factors such as the global economic slowdown, Ukraine, and the Russia conflict are cited as reasons for these conditions by the Federation of Indian Staffing Companies (FISC), a union of 120 regulatory agencies. Around 60,000 outsourcing contract workers in IT companies are employed through these regulatory agencies. Among them, 6% accounts for 3,600 employees who were laid off in just one quarter, as mentioned in the submission. Even in the coming days, the flex staffing is expected to decrease further, as reported.
Breaking News: Layoffs in IT Industry in India
Around 51 million individuals are currently employed in India’s IT sector as of March 2023. Temporary regulations have been put in place, and there has been a downsizing of contract workers. The employment rate has experienced a slight decline. Additionally, the number of vendor-contracted positions in Indian companies has reached 14 million, with approximately 80% of these positions being held by women. The prevalence of online transactions has surged due to the COVID pandemic, leading to a significant increase in remote work and online training programs for IT firms.
Consequently, IT companies have commenced scaling back on projects in response to these circumstances. It is worth noting that the ongoing conflict in Ukraine has exacerbated resource shortages in Europe, driving a heightened demand for IT professionals. As a result, clients are now approaching IT companies on a daily basis. Subsequently, IT firms have also witnessed a decrease in orders, prompting the implementation of flexible staffing reductions.
Since the beginning of this new year in 2023, the situation of IT employees has become pitiable. Globally, companies like Google, Microsoft, Meta, Amazon, as well as Indian organizations like Infosys, Tech Mahindra, Wipro, and others have laid off numerous employees. From small to large companies, jobs are being cut with the pretext of controlling expenses.
