Nasscom Warns Of More Layoffs After July; IT Spending Will Drop 1st Time In 5 Years?

Nasscom Warns Of More Layoffs After July; IT Spending Will Drop 1st Time In 5 Years?
Nasscom Warns Of More Layoffs After July; IT Spending Will Drop 1st Time In 5 Years?

In an interview, Nasscom chief Debjani Ghosh has warned that there can be more layoffs in the second half of 2020, as businesses are struggling to survive amidst this mayhem caused by coronavirus.

In a related report, it has been found that IT spending has dropped by 8.1%, which is 1st such drop in last 5 years.

Things are looking gloomy.

Nasscom: Expect More Layoffs In 2nd Half Of 2020

When YourStory asked on the possible layoffs, Nasscom President warned that there can be more in the 2nd half of 2020.

However, being optimist, she told that the employees who are getting laid off can be come forward and create an entrepreneurship movement, if provided with the right help and tools.

She said, “Over the year, we will see more layoffs across sectors. All the talent that is being laid off can be put to good use for the nation and by the nation if we can create an entrepreneurship package to encourage them to come forward and innovate.”

When she was asked what advise she will give to entrepreneurs and employees who are getting fired, she said, “The people cost is one of the biggest in the tech world. Cost rationalisation happens in every crisis. Layoffs are going to get worse towards the second half of the year. So, I’d tell entrepreneurs — do it with heart. Have conversations, help however you can, give a good reference.”

She added that employers need to be more humane, and more considerate. She said, “Do it in a humane way. These things come back. Loyalty goes a long way in our business.”

For the employees, she advised that make yourself ‘indispensable’ by learning more skills, technology and getting more experience. 

She also referenced that Nasscom has made several courses of the next gen technology free, and such employees should make use of the same.

She said, “NASSCOM has made many courses like coding, AI foundation, Big Data foundation, robotics free. This will pass, there will be new opportunities. But, be ready with your skills. Use the time to upskill, stay positive, and reach out for mentors.”

You can find the whole interview here.

IT Spending Drop 1st Time In 5 Years

Meanwhile in a research, Gartner has predicted that IT spending in India by various IT firms can drop first time in 5 years.

The drop will be 8.1% as of now, but still a significant number, which will further shake up the industry.

8% drop in IT spending translates to around $300 billion less investment, which will impact jobs, new projects, expansions and more.

Naveen Mishra, senior research director at Gartner said, “The fear of a global economic recession due to the COVID-19 pandemic is forcing CIOs (Chief Information Officers) in India to be very cautious about their IT spending this year. In partnership with their CFOs (Chief Financial Officers), CIOs in India are reprioritizing their IT budgets on mission-critical initiatives.”

As per Gartner, IT spending in the sectors such as education, healthcare, and public utilities has increased due to the lockdown and coronavirus impact, but at the same time, sectors such as retail, insurance, and banking will reduce their overall IT spending.

At the same time, Gartner has predicted that spending on key technologies such as artificial intelligence, machine learning, and virtual sales assistants will increase.

But spending on business transformation, process re-engineering, and modernization of existing systems can decrease.

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