India's IT students feel the heat

By Swaminathan Natarajan
BBC Tamil service

An offer of a job is not always secure these days

The slowdown in India's much-acclaimed information technology (IT) sector has translated into a drastic reduction in the number of jobs being offered to students through on-campus recruitment.

India's IT sector had emerged as one of the biggest job providers in recent years.

Most students who entered the portals of India's top colleges could safely bet on getting a highly-paid job before they entered the final term.

But the global recession has meant that projected revenue has not materialised for many of these IT companies, which are heavily dependent on the US and Europe.

Pay cuts

The vice-chancellor of the Madras-based Anna University, Mannar Jawahar, says that things are looking grim for students in the short run.

With the job scenario not looking bright I find a lot of depressed students VC Ravichandran, Anna University

"In the past, 88% of engineering students - irrespective of their field of specialisation - got jobs with IT companies. Since the jobs are shrinking there, it will be difficult for some time," Dr Jawahar says.

Newspapers are regularly carrying stories about IT companies announcing their intention to freeze or cut pay. This is new to an industry known for its generous remunerations, big bonuses and lucrative stock options.

The IT giant Infosys has projected negative growth for the coming year and has recently dismissed 2,100 employees because of "poor performance".

Tata Consultancy Services, the biggest Indian IT firm, has plans to trim its UK staff by 10% - or 500 jobs.

VC Ravichandran, who is in charge of campus recruitment at Anna University, feels there is a big difference in the attitude of many companies now.

"Last year when we had a state-level recruitment programme, we conducted interviews in five locations. In all 4,000 students attended and 800 were selected.

"But this year many companies did not come forward and as a result we had job interviews in three cities only. Out of 900 students who went for the interview, only 50 got selected," he says.

Interviews

Dr Ravichandran says that poorer parents in particular were hoping that the continuous growth of the IT sector - and its good pay packages - would provide lucrative jobs for their children.

University leavers are looking to the public sector for security

"They sold their land or mortgaged their belongings to send their children to expensive self-financing colleges. With the job scenario not looking bright I find a lot of depressed students from these kind of families. I keep on assuring them things will improve," he says.

Hari - a final-year student of mechanical engineering - was keen on an IT job and went for a few interviews. But he has yet to get a job.

"Manufacturing companies are cutting jobs because of the recession and the same is happening in the IT sector, so we are worried," he says.

Vijay Ram and Sundaram are final-year students of printing technology. Both of them got placements in a reputable IT-based multinational company. But now they want to explore their chances with other companies.

"Software companies gave job offers to us when we were doing our sixth semester. But many of our seniors who got the job offers from these companies are yet to get orders to join. So getting a job offer does not mean one has a secure job," Vijay says.

Nasscom, which represents the interests of IT outsourcing companies in India, says that many are struggling to fulfil their job offers within the stipulated time.

"Twenty-five big companies who have given 75% of the total job offers have told us that they will honour their commitment within the next six months. This is due to the extraordinary global situation," says K Purushotaman, regional director of Nasscom.

Difficulties

The bleak job scenario has meant that students have started to discover the benefits of working in state-run companies. Public sector firms operating in power, oil and manufacturing have increased the number of recruits and are offering attractive pay packages.

The IT sector has been a big taker of engineering students

Shiva Shankari, a final year student at Anna University, has been promised a placement with BHEL, a power equipment manufacturing company owned by the government.

"I opted for a government company for job security. I have a background in electrical engineering. The job is very much related to what I studied. Most of the IT companies are offering a salary of 300,000 to 400,000 rupees ($5,950 to $7,950) but I get more than that in the public sector," says Shiva.

Analysts believe that the rapid increase in the number of engineering colleges has also added to the difficulties of students.

"There is a pressure on the supply side. In a survey last year we found that 22% of engineers remain unemployed for a year. We think this year it will jump to 30%," says K Pandia Rajan, chairman of the Ma Foi management consultancy.

While some analysts argue that the unhindered supply of high-skilled manpower is the key to sustaining the Indian IT sector - which now contributes to 5% of the country's GDP - this is little consolation to students who are desperate right now to get a job.