Automation Will Drive 1.8-3.7 Lakh IT Engineers Out Of Job; Campus Recruitment Drops to 7 Year Low



Nasscom has predicted a gloomy picture for the Indian IT industry; and not only freshers, but existing employees may feel the pinch of automation in the coming months.

As per current predictions by some of the leading research agencies, it has been reported that campus recruitment of engineers will drop for the first time since 2009; and around 5-10% of existing workforce in IT industry, which amounts to approximately 1.8 to 3.7 lakh workers, will lose their jobs due to automation.

IT Freshers No Longer Needed?

As per a joint study by Nasscom and Mckinsey, it was revealed that IT companies are looking to strengthen their existing workforce, improve their bench strength, rather than going for mass-hiring as it did since last 10 years.

For the fiscal year 2016-17, IT firms will hire around 2 lakh freshers, which is almost same as last year, and even lower.

During 2014-15, 2.2 lakh freshers were hired.

Automation is the sole reason for this drastic undercutting of new jobs, as entry level coding and testing would be now accomplished by robots or AI, rather than freshers. Due to this single reason alone, utilization levels of existing workforce has improved by 4% in the last three years, and the trend will continue.

Nasscom president R Chandrasekhar said, “Companies are focusing on increasing utilization levels and reducing bench strength. They are also adopting automation in a big way and reskilling their employees so as to increase the net productivity per employee,”

16 lakh engineers pass out from Indian colleges every year, with a dream of working in IT industry. It seems that only 12.5% or 2 lakh would be placed this year.

5-10% of IT Workforce Will Be Out Of Job?

The Mckinsey-Nasscom study also predicted that in the next 10 years, around 5-10% of entire IT workforce would be replaced by automation. There are approximately 37 lakh employees working in the IT industry, and by this prediction, it is clear that 1.8 to 3.7 lakh engineers’ jobs would be replaced by automation in the next 10 years.

However, Chandrasekhar also stated that demand for jobs in new-age technology like robotics, artificial intelligence, biotech, nanotech, Internet of Things, big data, social media etc would be in demand, as automation can’t be applied in these industries.

Re-skilling is the need of the hour, as IT firms are increasingly looking at re-training their existing workforce, and enable them to work with the new-age technologies.

Those who won’t be able to adapt, will be asked to leave.

Chandrasekhar said, “In this new world order, technology and automation have taken the centre stage, and companies are deploying them at a rapid pace to enhance productivity. This trend will bring in a sea change in talent restructuring and deployment, creating healthy competition and re-skilling opportunities.”

Interestingly, the report also mentions that in order to generate $100 billion revenues by 2020, IT industry will require 1.2 million to 2 million new workers.

Automation related news we covered in the last few months:

Pizza Hut Launches Chatbot To Book Orders Via Facebook, Twitter: Automation Taking Over Food Industry?

Automation, Robotics & Tech Will Kill 5.1 Million Jobs By 2020: WEF

Automation Is Taking Its Toll: Top 5 IT Firms Have Hired 24% Less Employees in 2015

Business Automation Has Cost 1,00,000 People Their jobs in Infosys, Wipro & TCS In A Year

Automation Will Wipe Out 50% Of All IT Jobs in India; But Digital Startups Increase Hiring Activity

Infosys To Reduce Bench Strength And Focus On Automation, Says Vishal Sikka

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