IT SLOWDOWN FEARS QUICKEN AS FIRMS GO SLOW ON HIRING FROM IITS

Kalpana Pathak & Shivani Shinde, Mumbai, February 25, 2008
Business Standard

Information technology (IT) firms appear to have lost their appeal at the Indian Institutes of Technology (IIT). Campus recruitment figures by major Indian and foreign IT firms have dipped this year, raising further concerns of an industry slowdown.

Firms like IBM, HCL, Hughes Software and CSC opted out of placements this year and hiring by firms like India’s largest IT services provider Tata Consultancy Services (TCS), Infosys and Wipro has dropped.

Confirming the trend, a placement official from IIT Roorkee said: “While many companies say they have a particular number in mind and would recruit likewise, our alumni network at these companies informs us that these IT giants are exercising restraint in recruiting trainees due to a slowdown.”

Agreed a placement official from IIT Kanpur: “Like every year, the institute offered the regular number of students to these IT companies for placements but they did not pick as many students.”

Recruitment by IT companies at IIT Kanpur has gone down from 130 students in 2007 to 72 in 2008.

“Clients from IT firms are increasingly in the process of utilising their bench strength,” said Monisha Advani, managing director, Randstad India, an HR consultancy firm.

With the US slowdown and rupee appreciating against the dollar for most of 2007-08, IT firms are under tremendous pressure to manage margins and costs. IT firms have been in the news recently with TCS, IBM India, MphasiS (an Electronic Data System company) and Yahoo! India asking several hundreds of employees to leave on grounds of “poor performance or non-performance”.

“What we have been hearing these days is a clear case of skills mismatch. While non-linear growth is the way forward, it is something that will happen on a long-term basis. In the short term, IT firms will need to have volumes,” said Sudin Apte, senior analyst and country head, Forrester India.