TCS, Infosys & Other IT Firms Can Fire 30 Lakh Employees Due To Rise In Automation (Report)
If you thought that pandemic and lockdowns were the real threat to IT jobs, then you will need to think again.
As per a high profile report that has caused ripples across the IT industry, it has been estimated that the top IT firms in India and globally can fire upto 30 lakh employees in the next few months.
These IT firms include TCS, Infosys, Wipro, HCL, Cognizant and others.
Rise in automation has been attributed as the primary reason for this mass firing.
What’s happening here?
Automation Will Wipe Off 30 Lakh IT Jobs
Bank of American has released a report on the job prospects in the IT industry, and the outlook is very grim, atleast for the employees.
As per the report, 30% of the low-end IT jobs can be wiped off, due to the rise in automation.
And every major IT company in India and globally will have to participate in the culling of jobs, in order to save money. It seems its inevitable.
The report said, “TCS, Infosys, Wipro, HCL, Tech Mahindra and Cognizant and others appear to be planning for a 3 million reduction in low-skilled roles by 2022 because of RPA up-skilling. “
Which IT Jobs Will Be Terminated Due To Automation?
IT and ITeS industry employs roughly 1.6 crore employees in India. Out of this, 9 million are low-end, repetitive sort of jobs that can be automated easily. Hence, as per the findings of the report, 30% of these 9 million jobs are at risk, as early as 2022.
Top IT companies such as TCS, Infosys, Cognizant, Wipro, HCL and others can remove these 30% of the jobs from the low-end IT spectrum, and deploy the Robot Process Automation process or RPA.
Reacting on this news, Harpreet Saluja
President, Nascent Information Technology Employees Senate NITES said, “Maharashtra accounts for more than 30 percent of the country’s software exports, with over 1,200 software units based in the State, thus providing a familiar and friendly environment for the IT companies.
The Government of Maharashtra recognized IT industry as an important thrust area in the State. It is largely focusing on providing IT related infrastructure, fiscal incentives to IT units, IT in governance and institutional framework for the IT sector. These initiatives have enabled the IT industry of the State to establish a firm foundation for itself in the country. The Nascent Information Technology Employees Senate NITES – is working extensively for the welfare, benefit, protection and empowerment of IT / ITES employees in Maharashtra.
Since April 2020, the Nascent Information Technology Employees Senate-NITES has raised issues ofmore than 78,000 employees. In the meantime, many petitions have been filed with the Chief Minister’s Office, Labor Department and District Magistrate regarding illegal termination of employment, reduction of wages, pressure on employees to resign, reduction of earned leave, non-payment of maternity benefits and various other problems but till date the employees have not received justice. The recent Bank of America (BOA) report for IT workers is nothing short of a nightmare.
The Bank of America said in a report that due to automation, Indian IT companies are preparing to lay off large numbers of employees by 2022. The Bank of America said that while the pace of automation is accelerating, by 2022, domestic software companies that employ 16 million people will lay off 3 million employees. According to the report, the layout companies will include TCS, Infosys, Wipro, HCL, Tech Mahindra and Cognizant.
The BOA said in a report that this would result in huge savings of 100 billion for these IT companies, most of which they spend on employee salaries. According to Nasscom, about 16 million people work in the domestic IT sector in India, of which 9 million work in low-skilled services and BPOs.
According to a Bank of America report, 30 percent of these 9 million people, or 3 million people, will lose their jobs primarily due to robotic process automation (RPA). The Bank of America’s report on planned job cuts by IT sector is disturbing & devastating.
Therefore through this letter, we humbly request for immediate intervention of State Government to include NITES as a representative of IT / ITES employees in the Maharashtra Workers Welfare Board and to establish an independent board for IT / ITES sector to protect the welfare, rights and families of IT / ITES employees in Maharashtra.”
How Will IT Firms Benefit?
The report states that the IT companies can save a direct $100 billion in salaries, in case 30 lakh jobs are removed in the next few months.
Besides, $10 billion will be indirectly saved by the IT firms due to less no. of people working. $5 billion market can be created from scratch, for developing such robot based automation software for other companies.
Note here, that RPA or Robot Process Automation are bots or software that mimic what an employee manually does, and processes it automatically. RPAs can work 24*7, and one bot can easily do the work of 10 employees.
We will keep you updated, as more details come in.