With the advancing technology resulting in automation of work processes, the job market is being hurt. In the last one year, automation has taken up jobs of 1,00,000 employees in Infosys, Wipro and TCS even as their size and operations increase, according to ET Analysis. Gross addition for the three combined stood at roughly 150,000, while net addition was between 40,000 to 50,000. The attrition rates are increasing by the day, and we’re surprised by the fact of how normally this phenomenon is being sunk in by the companies.
Large IT companies in India have seen a humongous change with advent of technology. In the last decade, these companies were adding up tens of thousands of engineers every year, and loosing out on a very few. New technologies such as cloud computing are proving to be more reliable and error free than human hands. May be that is why the sudden drop in the number of employees in IT firms. The work gets done faster, hence improving the rate and quality of productivity in these companies.
There are many who still believe that still believe that technology boosts productivity and makes societies wealthier, but on the contrary, it can also have a dark side: technological evolvement is disregarding the necessity for many types of jobs and leaving the typical worker worse off than before.
That robots, automation, and software can replace people might seem obvious to anyone who’s worked in automotive manufacturing or as a travel agent, but in India’s IT sector, has got the pinch of it, a real hard one. Leading tech companies are moving way fast with improvising automation. Companies try to contain attrition levels in the current context of automation and other emerging new technologies in the Indian IT industry, according to a few CEOs of domestic top 10 outsourcing companies. Here’s what the who’s who of India’s tech industry have said on the issue in the recent past:
N Chandrasekaran, CEO at TCS, in a keynote speech at the Morgan Stanley Annual India Summit last month had said, “In FY10, we had a revenue of $6.3 billion with a headcount of 160,000. In FY15, we doubled the headcount to 320,000. But the revenue did not just double. We generated revenues of $15.5 billion, representing a productivity gain of nearly $3 billion.”
“We rolled out the Infosys Automation Platform within infrastructure management service to the first 10 clients and we saw productivity improvement of up to 37% and people savings of up to 17% in those cases,” Infosys CEO Vishal Sikka said during an investor call last week. “This gives us a significant hope for bringing in automation as a value driver and amplification of our capability so that we can do more projects with less number of people, so that we can bring differentiation to our projects as well as address the margin,” he said.
Wipro is also following a similar strategy, with its in house AI-powered automation platform Holmes. “Holmes has got 70 engagements last quarter. If you look at current headcounts in infrastructure and ADM businesses, we have taken out (and redeployed) close to around 1,000 people from current jobs by using these platforms,” Wipro Chief Executive TK Kurien told ET in an interview.
The Nasscom data is a startling assertion because it threatens the faith that many people have in technological progress. If the picture remains like this, economic theory and government policies will have to undergo changes if technology is destroying jobs at this pace, contributing to the stagnation of median income and the growth of inequality.