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Dark Cloud Hanging over Senior-Level Employee’s Position in Indian IT Firms

October 12, 2017

Just recently on August, approximately 400 senior executives in Cognizant Technology Services accepted the company’s voluntary separation package (VSP). The software development company had announced this programme for directors, associate VPs and senior VPs a few months ago.

French IT services major Capgemini had announced similar report, asking over 35 VP, SVPs, directors and senior directors to leave in February this year.

Major IT services organisations are all in the process of reducing the size of their workforce on unseen scale since the interval of 2008 to 2010 downturn. Among the positions affected directly from the layoff are mid- and senior-level professionals, those with 10-20 years of experience, the Economic Times reports.

Recent phenomenon of job cuts among senior level in the tech sector have been predicted by Experis IT Employment Outlook Survey from Experis IT – ManpowerGroup India for October 2017 – March 2018 edition. Surveying 500 employers across India, the study found that there is very little demand for senior-level IT executives among employers, indicating a dark cloud hanging over those in such positions.

See: Voluntary Standard for Flexible Working Arrangements Launched

According to the survey, only 3 percent of employers surveyed said they wanted to hire people at the senior level for their organisation. Instead, the highest demand was seen for more junior candidates in the 0-5 years of experience slab, with nearly 56 percent employers showing an intention to hire people from this group. Meanwhile, another 41 percent wanted to hire those at the middle level (5-10 years of experience).

One among major reason behind rampant layoffs at the senior level could be owing to the employer’s tendency to filling up of vacancies with internal hiring rather than going for external recruitment. Another reason is because digital transformation has made automation taking away traditional team lead jobs, and thus leaving the positions redundant.

For example, project leader positions are increasingly being reduced since automation and smart robots kicks in big-time and newer, more specialised roles emerge in India’s $160-billion IT industry.

Peter Bendor Samuel, CEO of IT consulting firm Everest Group, said industry growth is seeing a slowdown and the ‘arbitrage first’ segment (traditional IT services) is in secular decline.

“When this is added to the pyramid factory model, which requires new freshers to be brought in every year to keep cost low, it resuts in an excess of more experienced employees,” he said.

Read also: Singapore Press Holdings Plans Over 200 Job Cuts despite 32 Percent Profit Rise

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