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The HR strength of the industry grew 10%, with headcount at 581,235
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As recruitment picked up, attrition rose again—from 4% to 8%
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On an average, companies hired over 200 professionals in 2002-03
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Management training went up by 5% across IT companies
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The boom of 1999, the bust of 2000, the recovery of 2001, and then a slow but
definite climb—fiscal 2002-03 was the year of hiring for information
technology companies, though the note remained cautious.
With fresh graduates out in the cold and pros left with few options, the
humbling of the once pampered Indian IT professional was more or less completed
in the past two years. Things picked up last year, though, as businesses
recovered and companies started building up manpower again. But the sky-high
salaries, fabulous perks and frenetic pace of inter-company poaching that the
boom had witnessed, were all things of the past. The experience and learnings of
the bad times have clearly made the IT pro a more careful job-seeker, and career
decisions were made after much study and deliberation, diametrically opposite to
the previous trend—when companies were changed for fatter salaries and
overseas assignments.
Welcome aboard...
The pink slips had defaced the heady image of "always-in-demand"
IT professionals. While the recklessness of the 1999-2000 boom gave way to a far
more responsible and mature workforce in 2001-02, fiscal 2002-03 signaled that
there were jobs to be had again. While there was a sense of caution in the early
part of 2002, recruitment plans turned aggressive in the second half and
continue to be so. Top software companies like Tata Consultancy Services, Wipro
Technologies, Infosys and Satyam Computer recruited nearly 4,000 professionals
each in 2002-03. However, the hiring was focused on essential skills—with an
eye to improve the utilization and productivity of existing human resources.
Campus recruiters clearly kept in mind the future skill needs for training and
deployment before dishing out offer letters.
In the year under way, recruitment will continue to be strong, despite the
watchful attitude of most companies. While the financial outlook of some may be
cautious because of reduced billing rates, volume growth continues to be strong.
The number of jobs created—and recruitment plans—are a direct consequence of
volume growth, not billings growth.
Greenhorns go a-grazing
The upswing in recruitment comes with a caveat, though, as a major part of
the demand has been for professionals with experience. Along with the pink slips
had come the jolt for the young turks of Indian IT. Batches of fresh graduates—including
the toppers—were exposed to the vagaries of the market even before they became
part of the industry. Much to their shock, promised placements were cancelled.
Even as things look up in the industry, little has changed for the freshers.
In fact, the bias for hiring people with experience intensified during the last
year. The demand for freshers vanished completely in 2001... Sure, it resurfaced
in 2002, but relatively speaking, finding freshers is not the "pain"
point of IT recruiters anymore. Companies are looking for professionals with
proven skills in specialized areas—or those with project management skills.
And the trend should continue.
Grown-up techies
While hiring trends were conservative, the fundamental difference was that
firms were looking to hire people with high-quality consulting experience,
rather than focus on skill-based recruitment. IT consulting is the space that is
likely to emerge as the frontrunner in the near future. Consultants need an
understanding of the customer’s pain points and have to address the IT needs
of the customer, rather than simply writing codes in a technology or language
that’s in demand.
So where were the hot IT jobs last year and where will they be in the future?
Domain areas like ERP, CRM, chip design and data security continued to be in
demand. Telecom software bounced back, with a lot of projects flowing in.
Specialized skills like package implementation, .net, data warehousing and CRM
also gained ground in Year 2002-03. Specialized skills (DW/PI/CRM/.net) were hot
last year—with the trend likely to prevail in the coming year.
The one segment that continued to witness phenomenal hiring was business
process outsourcing. While even toppers from engineering streams were left
scouting for IT jobs, fresh graduates with the "right attitude and
diction" were rapidly picked up by the burgeoning BPO sector. With their
regional accents neutralized, Jayas became Janes and Shekhars became Steves,
servicing global customers 24x7. With salaries in the range of Rs 8,000 to Rs
15,000 per month, BPO is the real HR success story of 2002-03.
However, most professionals view BPO jobs as a stopgap arrangement between
pursuing higher studies, moving on to the services industry or getting married—and
in a clear fallout, attrition rates remain high. For the future, the BPO labor
market is expected to continue to boom despite rumors about legislations, which
will restrict outsourcing, in various countries.
Meanwhile, with little money to spare, IT companies have found innovative
modes to keep the morale up. Stock options, which used to be an important
criterion, no longer have any value attached. Companies are, therefore, shifting
more towards cash bonuses, linked to performance, as a means to reward and
motivate good performers. And even when money is in short supply, projected
growth paths, training and other means to hold on to employees are adopted. But
retention is certainly not as difficult as it used to be.
U-turn to India
The fizz has gone out of overseas assignments and the backlash is on people’s
minds. Besides, most jobs are now for "offshore" projects. A few years
ago, most IT pros used to get the opportunity to work abroad as the percentage
of "onsite" jobs used to be significantly higher. Now, only the best
performers get the opportunity to work onsite. Most IT professionals would be
hesitant to take up a full-time permanent job in the US today because of the
uncertainties involved. The last two years have seen IT pros preferring job
security over fatter salaries and perks. Therefore, the preference is on getting
a job with an India-based Indian company that can offer the employee
opportunities to go abroad for a few months to work on specific projects. The
"body-shopping model" is no longer relevant. In the year to come,
consulting and domain expertise will take precedence over the professional
services model and hiring will continue.
Manjiri Kalghatgi
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