IT sector worst hit
The flare-up of Covid-19 has affected the global economy resulting in slowdown without sparing any sector. Recession is now a reality. Indian IT sector with 75% presence in the global IT market has been hit hard. Reports of layoffs in the past few months are a pointer.
The nation is undergoing second phase of layoffs. Since last two years, automation led to layoffs, now it’s the turn of Covid. The sector is scuffling with lack of engagements and projects leading to retrenchment to resize the surplus human capital.
Automation, non-performance, right sizing, lack of projects are reasons cited for layoffs. Big IT giants like IBM, COGNIZANT, ACCENTURE are leading the race. Sample this: IBM: is retrenching 2,000 employees globally which may end up in hundreds as 1/3rd of IBM employees are from India.
COGNIZANT: Nearly 18,000 employees are laidoff in India. The employees who are on bench are terminated quoting that they are non-billable.
ACCENTURE: 5% of employees are targeted globally. With 2, 00,000 employee base in India, it would be around 10,000 employees who are on the verge if getting pink slips.
Other giant tech organisations like TCS, Wipro, Infosys, and HCL not yet delineated any figures of retrenchment. Instead of layoff’s these companies are adopting trimming of pay structure, holding of promotions and hike.
Wipro chairperson Rishad Premji stated that there would be no layoff even for a single employee but a cut down in pay package by 15% to 20% during the pandemic . TCS confirmed that there would be no Covid layoffs. While, Infosys COO Pravin Rao assured that they are not having any mass layoffs because of Covid and also hardened that there would be no performance layoffs as usual.
Basing on the reports of (NSS) National Sample Survey and Periodic Labour Force Surveys (PLFS), it is expected that nearly 1.5 lakh people are on red line of layoffs. Many small IT firms are on neck of the woods. Start ups are grappling for their survival and existence.
Companies are left out with no other option either to tailor made pay structure/ layoff’s. The sector is seeking advice from legal bodies regarding this scenario for further move. The employees who are on the fringe of retrenchment have financial, psychological, behavioral, ethical, and legal effects which even impact their personal life. This may lead to mental imbalance and depression.
