Automation to shave off 25k jobs in IT sector

Increasing automation would shave off 10% of incremental jobs in India's IT sector each year even as half of middle-level managers would also bear the brunt in the era of artificial intelligence, says industry veteran T V Mohandas Pai.

"I think in the IT sector, may be 10% minimum of incremental jobs that are created will disappear. That means every year if they do (create) 2 to 2.5 lakh jobs, 25,000-50,000 jobs will disappear," said the former CFO and HR Head at Infosys.

According to him, middle-level managers account for 10% - or 450,000 people - of the 4.5 million (45 lakh) strong IT industry in India. Half of them (2,25,000) would lose jobs over the next one decade as their work would get automated.

"There are today lots of people (middle-level managers) earning between Rs 30 lakh and Rs 70 lakh (per annum). Half of them will lose their jobs in the next ten years," Pai said.

The tech investor said the new breed of IT engineers should have better skills and deep technical knowledge, adding, prospects for those having just a bachelors degree (B. Tech) are going to be less and less in IT.

Stressing that IT hiring would become more and more specialised with companies looking for higher and greater levels of expertise, Pai said he would recommend the aspirants to do masters (post-graduation).

"An ordinary B.Tech is like 10th standard today because you have to go ahead for the next 30 year," the chairman of Manipal Global Education said.

"For lower-level jobs (entry-level), hiring will keep reducing by 10% every year. Ordinary graduates who are trained to go up the ladder will have less prospects. Out of the total number of people hired, fresher level doing ordinary work, there will be 10-15 per cent reduction in the category year-by-year," he said.

But there will be 10-15 per cent increase in the category of masters (post-graduates) and skilled people because there is a great need for that, added Pai, a prominent angel investor.

He said automation, machine-learning (artificial intelligence) and robotics would create a new kind of specialised workforce.

"People who have got skills in artificial intelligence, machine learning and new coding languages like Python, Android and those in mobile area would do very well in the next five years," he pointed out.

Only 2 lakh-2.5 lakh IT engineers out of the total 6.5 lakh who come to the market every year get jobs in their chosen field.

"Many of the engineers who come out of bad colleges.. there are good jobs like Ola and Uber waiting for them. I am not joking. In Bengaluru, many of the software engineers are giving up their jobs and driving Ola and Uber and making more money. It's much more lucrative. Why work for 14 hours a day (in an IT company) and earn (only) Rs 3.5 lakh (per annum), when you can earn Rs six lakh to Rs 7 lakh (per year) driving a car?" he said.

The Head of Aarin Capital Partners said Indian IT companies are ahead of the curve as far as automation is concerned and "they are winning the battle."

"Five of the top 10 globally competitive (IT) service companies are Indian," added Pai.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel