
India’s IT industry laid off more than 56k employees this year - codesternews
https://qz.com/1152683/indian-it-layoffs-in-2017-top-56000-led-by-tcs-infosys-cognizant/
======
code4tee
There will be many more. The India IT sector’s main play was cheap labor for
low value-add IT tasks like basic dev or ops. The play a while back was to
move day-to-day ops jobs to this cheap labor. Now the play is to automate this
work so the jobs are disappearing. E.g when you move to the cloud with good
architecture you don’t need tons of people pushing buttons and tweaking
servers all day long.

The India firms haven’t really moved up the value chain much and thus there’s
just less work there. They put fancy marketing on the front but their main
product is still cheap labor for low value IT work. While there’s certainly
advanced stuff happening in India, at the big scale the top R&D and
engineering work still generally occurs in the home countries that were
sending work to India and there’s little evidence that these jobs could, at
scale, be done successfully by the Indian firms offshore.

~~~
navinsylvester
Might be the case with many IT services firms but assuming that so called home
countries brains only can do serious engineering is quite short sighted.

I head an engineering team from India and our team is local talent for a firm
which is outside India. We believe we do some serious engineering.

There is this west fixation that serious engineering can't be done outside. I
am not saying it isn't true on most cases but assuming they only can do is so
demeaning. I get asked a lot - so who does the heavy lifting?. Nothing gives
more satisfaction than to say - we do the engineering and it gets maintained
by westerners in our organization.

~~~
ryen
>but assuming that so called home countries brains only can do serious
engineering is quite short sighted.

I don't think thats the point he's trying to make. The Indian IT industry was
designed and built for a certain type of labor/outsourcing market. It will
take serious investment and attitude shift internally for local startups to
grow and retain talent. Much of that talent that is able to perform the
serious engineering you describe continually leave the country for the U.S.
and other markets.

~~~
navinsylvester
> at the big scale the top R&D and engineering work still generally occurs in
> the home countries that were sending work to India and there’s little
> evidence that these jobs could, at scale, be done successfully by the Indian
> firms offshore.

I was talking about this outright dismissal without any ground.

> Indian IT industry was designed and built for a certain type of
> labor/outsourcing market.

Indian IT industry got shaped by the demand. You wanted cheaper options and
you got provided one.

> It will take serious investment and attitude shift internally for local
> startups to grow and retain talent.

Pay good and you will retain talent.

> Much of that talent that is able to perform the serious engineering you
> describe continually leave the country for the U.S. and other markets.

Please speak for yourself. The west fixation does not apply to all folks. We
get to do awesome engineering work here so don't have to be in a foreign land
to do so. With remote teams coming into the picture having a preset notion
that a team has to be local is an outdated mindset. And also - we can afford
couple of maids in a decent paying job and have a better lifestyle here than
the west can afford.

~~~
sumedh
> And also - we can afford couple of maids in a decent paying job

Which is nothing to be proud of, the maids are affordable because lot of poor
people did not have the same privileges like you had.

~~~
dominotw
Yea why do Indians always brag about having maids. That's disgusting.

~~~
sumedh
Unfortunately the poor people who are usually illiterate are treated as a
lower class.

The rich or upper middle class kids while growing up see that they and their
parents can order the maids to do almost anything and so when the kids grow up
they see the maids as a class of people who are not equal to them.

It becomes a status issue as well if you say you dont have maids then your
affluent peers will think you are weird or that you cant even afford a maid.

------
sytelus
I see a large number of bright Indian developers now staying back in country
because its almost impossible to get H1B visas (that was actually the case
even without Trump and now its getting much worse). This has started
interesting trends in India. All of the sudden, now there is VC culture
shaping up and I'm seeing lots of Indian developers doing their own startups.
Indian newspapers frequently are putting spotlights on these young
trailblazers and writing stories of their struggle and triumphs. There are
startup events, meet ups and conferences going on virtually every week
somewhere. And in fairly short amount of time, India has racked up some huge
successes like Ola, Gaana, Oyo, Flipkart with stories to match with their SV
counterparts. This scene is very different from what I had known 5-10 years
ago where India held massive number of IT professionals but top 10% of talent
pool kept getting drained out of the country. Despite having largest number of
IT professionals, country was without its top talents and consequently without
any products and startup vision. The scarcity of H1B visa had been magical for
Indian startup scene and if this trend continues, US software dominance should
have contender in future.

~~~
aws_ls
Your narrative has some flaws. Startup events have been happening in India
since past 10 years or so. Ever since Google won the war with Microsoft.

Flipkart was founded in 2007. Ola soon after. This H1B visa issue is more of
past 2-3 year issue. Admittedly it will have some impact. But definitely not
the narrative you paint.

~~~
nonamechicken
I know one example: [http://money.cnn.com/2017/02/02/news/india/snapdeal-
india-ku...](http://money.cnn.com/2017/02/02/news/india/snapdeal-india-kunal-
bahl-h1b-visa/index.html)

He was denied h1b visa in 2007, came back to India, started a company that
created jobs in India.

~~~
aws_ls
Thanks for that link, I didn't know that. But in any case, my point is not
that H1B can't be an issue for any case. But that Startups scene in India got
a boost around 2005-2007, when many companies started, and it was nothing to
do with the H1B visa issue. Some failed as well. Guruji the Indian search
engine.

------
eksemplar
It'll probably get worse for a lot of people. I work in the public sector, in
a municipality. Our IT department has been relatively big on the server side,
utilizing consultants ever so often to ensure best practices.

To be honest I'm not an operations guy, and never have been, but I do work in
management and my good friend who heads the IT department is struggling to
find new roles for the operations people as we're heading into the cloud. It's
quite obvious to be frank, but without on premise servers we don't as many
need techs to run our setup, and we'll probably need a lot less consultants as
well as Microsoft offers this as part of the Azure package.

Financially it'll save us around 16 million Danish annually, which is roughly
32 jobs, and that's just operations.

In development things are changing as well. When we did our first webpage it
was a huge project, involving a lot of developers. The most recent one didn't
require a single developer because we used a standard product that one of our
designers happened to know.

Not that it's all bad. We're looking for people who do blockchain, machine
learning and big data, as well as project-managers who understand both
digitization and business. Of course these requirements will pose a
significant challenge for a huge part of the "traditional" IT workforce, which
unfortunately isn't very business savvy or mathematical. I mean, parts of it
is certainly very good at math, but typically not the people we can afford in
public IT.

~~~
Top19
Are you kidding me?

All of those operations people should be immediately trained in cybersecurity
and deployed literally anywhere in the country.

If you’ve seen the latest password dumps and how bad they are, cybersecurity
is getting worse if anything.

Also, as of 2015 the Chinese had 60,000 dedicated cyber security engineers.
This year the US I think has 9,000, maybe less, and they can’t even protect
the US, much less the rest of the world (unlike the globally deployed US
Navy).

Ops people are so important.

NOTE: I actually am an AWS Engineer and I like moving to the cloud, but still.

~~~
matte_black
China has one cyber security engineer per 22k Chinese and United States has
one per 35k Americans. To match China we need to increase our amount of
engineers by about 60%, or increase the effectiveness of an engineer by about
37%.

~~~
walshemj
and what exactly are these "cyber security engineers" doing in china or is
this just a fancy title for those monitoring the take from china's
surveillance state

------
blindwatchmaker
One of the articles linking from this one ([https://qz.com/964843/less-
than-5-of-india-engineers-are-cut...](https://qz.com/964843/less-than-5-of-
india-engineers-are-cut-out-for-high-skill-programming-jobs/)) made me laugh:

> More than two-thirds of the candidates from the top 100 universities in the
> country were able to write “compilable code,” or that which does not throw
> errors when compiled into machine-readable code.

I'm not sure what this is supposed to mean? Most devs make typos or errors
when writing new code at some point; the compiler spits out the reason (or
your IDE helpfully points it out), you go back and fix it.

> One reason for the poor performance is the dearth of good instructors as
> well as misaligned college curriculums. “The school curriculum focusing on
> MS-Word, Powerpoint, Excel, etc., rather teaching programming using
> elementary languages such as Basic and Logo is also the culprit,” said Varun
> Aggarwal, the co-founder and chief technology officer at Aspiring Minds.

Basic and Logo? What in the world?

~~~
grad_ml
This is plain BS. I don't recall any CS department in India (and I know 100's)
teaching, MS-word, Logo, Basic, Powerpoint, excel etc. However, I did TA'ed at
Rice University, TX, Excel course for freshman.

~~~
jackmott
they don't teach excel in the comp sci department at Rice.

~~~
shagie
You might want to check out their course catalog:
[https://www.clear.rice.edu/comp100/17-spring/](https://www.clear.rice.edu/comp100/17-spring/)

COMP 100 teaches students how to use common software for organizing,
searching, and computing on information, with an emphasis on business-related
tasks. It introduces engineering design via a medium-sized team project. The
course examines

databases — Microsoft Access spreadsheets — Microsoft Excel

------
jorblumesea
I truly believe offshore IT work was mostly a scam in the first place. The
work they produced was of very low quality, and often was more expensive
because you had to go back in and fix everything. The whole game was to
overcharge western firms for cheap crap produced by shoddy programmers
overseas. The IT outsourcing firms would pocket the difference. Come in and
promise the world, overbill and underdeliver. Then the client is stuck with
your crap and needs to pay you to maintain it.

It was on a matter of time before companies figured it out. Add to that
advances in automation and the move to the cloud, and this was guaranteed to
happen.

~~~
RandomCSGeek
There are 3 types of companies here in India.

1\. The likes of TCS, Wipro and Infosys. These have a huge workforce and
literally hire in wholesale. Even this month, Wipro hired something like 50
students from a nearby college. They don't look for your programming skills or
even CS theory knowledge. Nope. They hire based on marks, group discussion,
English skills and even looks. Basically, anything that is not related to CS.
Hell, they even hire mechanical engineers. In my college, students got placed
this year because, a. They had good relations with faculty. b. Looks(for
women) c. Acting "friendly" to a middleman(applies to women) If you deal with
these companies, I guarantee you, you'd get a poor product.

2\. smaller outsourcing companies. Some of these are good, some of these are
bad. Again, some manager might hire a student because she looks hot, while
some other might genuinely look for skilled students. I'd suggest dealing with
these companies, after getting good feedback about them from someone.

3\. Startups. These are few, but the number is growing. I hope to get selected
in one of these.

~~~
pritishc
Are you in college? You will find that 3 is not all rosy as it seems to you
right now, if you are not from a top tier or atleast decent tier college. I
was like you back in college when I realized that heading to TCS etc was a
dead career path from the start.

The better product startups all look for "IIT/NIT/whatever other brand
college" students. Snapdeal, for eg, first switched the application engineer
position that I applied for to other secondary positions, and then rejected me
when I asked for the original position on this basis. There is no guarantee
that you will find good things in other startups. I realize now that these
companies have no better way of screening candidates, because the candidate
pool quality in India errs on the side of less than decent. Doesn't justify
the bait-and-switch but oh well.

If you do end up like I did, make sure that atleast the peer group in your
startup is exceptionally talented, and that the startup is good with tech. The
pay is shit in these kinds of startups (for eg those running as a small
service company, but building their product behind the scenes), but the idea
is to become really good at what you do and then jump ship to a good product
startup.

Also, if you are still in college, it helps to have GSoC under your belt.

~~~
RandomCSGeek
So did you make it to a good company?

Yes, I'm still in college, although I'm in final year, so only 6 months left.
What you said is true, I realize that most companies are ignoring my resume(as
I am not from IIT/NIT, I am not even from a autonomous institute). But I hope
I can at least get placed in small scale startups, or small product
businesses.

Wish I had concentrated more on OSS contribution/ side projects rather than
competitive programming. Let's see what happens now. But I'm sure I won't join
the likes of TCS. Worst case, I'll become a Uber driver.

~~~
pritishc
You can still do OSS contributions and make small side projects to get
noticed. The likes of us merely start X years behind the likes of those that
go to a prestigious engineering college when it comes to work. X is as big a
gulf as you let it be. Factor that into your growth and make of it what you
will.

>I'm sure I won't join the likes of TCS

TCS is fine if you're fine with maintenance work and/or want to pivot into
doing an MBA or something similar. However, even TCS etc are laying off a lot
of people and will probably shrink their "bench" pools greatly in the near
future, due to the death of outsourcing.

>I'll become an Uber driver

I'm sure it won't have to come to that, but yes, the job market slowdown is
real.

------
abhishek0318
These people are mainly relatively unskilled. These companies are notorious
for hiring entire batches of graduating students.

Situation in top tier colleges is lot better. This can be seen from increase
in placements in IITs this year.

~~~
pksadiq
> These people are mainly relatively unskilled. These companies are notorious
> for hiring entire batches of graduating students.

I guess the best interview should also add a touch-type test and the candidate
should require at least 30wpm or so (if typing is very much required for the
work).

When I was at college I have only seen less than 5 such students from the 250
total.

~~~
Clubber
That's my secret tell to see if someone is a good, experienced developer or
not.

I've never met a good, experienced developer who was a slow typist.

~~~
EmployedRussian
> I've never met a good, experienced developer who was a slow typist.

You will.

There is a reason "fast typist" was not a required skill in any software jobs
I've ever applied for, and I doubt developer strength has any correlation with
typing speed.

~~~
Clubber
It's not that fast typist is an indicator of a good developer, but a slow
typist is an indicator of someone who hasn't spent a whole lot of time in
front of a keyboard.

~~~
hungryfoolish
Or they have some motor disabilities in their arm/hand, which you should check
for before making a judgement. Some people have carpal tunnel, some people
have tremors, some people might have other condition they might not have even
know themselves or would like to talk about openly.

~~~
Clubber
Or if they don't have any fingers.

------
sandGorgon
These are mostly outsourcing companies.

India's IT industry is realigning towards domestic markets and #MakeInIndia
companies - it is more aspirational to join Paytm, Ola, Zomato in India than
to work for a US based outsourcer.

It is not even a competition anymore - I'm able to very easily get highly
qualified Indians in Silicon Valley to move back and work on something cool in
India.

This is the reason that nobody in India (incl the govt) gives a shit about the
H1B rule changes in the US. The entire focus of the IT industry is shifting to
move up the value chain. We are trying to build more Freshdesk in India and
sell them to the world... Rather than body shopping.

It is going to be a time of massive upheaval as a lot of jobs will be lost -
both as a consequence of the US pushback on visas as well as the change in
strategic focus.

~~~
blocked_again
> I'm able to very easily get highly qualified Indians in Silicon Valley to
> move back and work on something cool in India.

We understand your sentimence. But please don't exaggerate too much :)

~~~
siddharthdeswal
I'm Indian and I agree with you. Parent overdid it a little bit. People gives
many shits about the H1B, and it isn't that easy to pull Indians back from the
US.

Relatively easier than say ten years ago, but not at the level of bravado that
parent exhibits.

~~~
sandGorgon
This is not incorrect. YMMV obviously...but I stand by what I say.

However you misunderstood the reason - they are not coming because of _me_.
They were coming back anyway because they want to work in India and build
something here.

That was my point all along - I'm not uniquely positioned. It's happening all
over.

~~~
kamaal
>>They were coming back anyway because they want to work in India and build
something here.

As a former NRI, who stayed in the US. Not one person I know has/or-is moving
back because they want to 'build stuff here'.

Most of the times its unworkable visa situations, old parents or something on
those lines at play.

~~~
sandGorgon
I suggest you go and check the senior leadership on LinkedIn for the current
stream of startups and large companies.

Even more - we have expats actually building _successful_ and _highly funded_
startups in India. Take a look at Zoomcar, Zestmoney and CreditMate. India is
extremely startup friendly for foreigners - maybe not as friendly as the US,
but definitely more than Europe, China, etc.

We are one of the world's largest consumer internet and smartphone market ...
oh and with strong net neutrality guarantees. Everyone wants to tap into that.
India is moving very differently now !

In the last week, I have had 2 conversations with CXO level leadership of
companies in the Bay Area, who want to move back to India and build startups
here. I get to do this a lot because I run one of the earliest YC funded
companies in India (when it was "special" for YC to fund an Indian startup). I
end up being the sounding board for a lot of CXO level talent moving back to
India.

BTW - Indian startups form the second largest pool for YC applications now
(after the US). Not sure what the funding stats are.

~~~
kamaal
Yeah sure. You can get senior leadership anything, as long as you pay 5x the
market standard pay. This is for companies who are a net negative in profit.

'Funding stats' don't mean anything in this case where they have to keep
dumping money never to see any returns. This will hurt the long term ecosystem
even for genuine start ups. As investors will largely look at India as some
kind of a money sink, where rogue upper managements splurge by paying big
money salaries to their own.

>>We are one of the world's largest consumer internet and smartphone market

Is this why Tata Docomo is shutting operations. Jio is in the debt of the tune
1,25,000 crores and Airtel is enduring losses just to survive?

>>oh and with strong net neutrality guarantees.

We all saw how 2G lobbying went.

>>Everyone wants to tap into that. India is moving very differently now !

Tap into what? Losses?

>>who want to move back to India...

Most of them hold US passports, and will bail at any hint of trouble. They
will continue to work as long as their obscene compensations are sustained.
They did the same during the 2008 crash. Moved to India, made big money and
moved back to US the moment the honey was sweeter there.

Let them put their money where there mouth is, give up US passports, take up
Indians passports and work here. Until then nothing much can be expected from
this loot-and-scoot crowd.

------
qxf2
This article has a random sprinkling of numbers that really do not give you
the big picture. Here is some context about the outsourcing industry in India.
Good stats to know (assuming the media is right):

1\. the entire IT outsourcing industry is ~$150 billion large and employs ~3.9
million people.

2\. the top 7 largest IT companies employ ~1.3 million people

3\. I cannot calculate the exact revenue of the top 7 companies because they
are part of larger groups (e.g.: TCS, Wipro). But the Top IT companies
headcount and revenue

a) Infosys: ~200,000 employees ($10 billion revenue)

b) Wipro: ~180,000 employees ($7.7 billion)

c) TCS: ~390,000 employees ($17.5 billion)

d) Capgemini: ~200,000 employees (I don't know)

e) CTS: ~260,000 employees ($13.5 billion)

f) Tech Mahindra: ~120,000 lakh employees ($4 billion)

Stories like these come around routinely in the April-June timeframe (every
year!) around appraisal time. This '56000' number is simply a random quote 5%
of the entire workforce of the top 7 companies. I have seen different media
outlets report the numbers as 28,000 this year to 200,000 in 3 years.
Honestly, they don't know nor do I.

FWIW, I run an outsourcing testing services firm in India. I am too small to
feel market trends. However, I have been reading and talking and interviewing
several candidates across India. I can tell you that the tension has been
palpable for the last 8 months or so. Many senior folks are feeling a quiet
sense of desperation. I don't know if the media sentiment started the tension
or if the ground reality is indeed going to force layoffs of senior employees.

------
Shangrila304
As someone who recently moved from USA To India this is the best thing that is
happening to India.

Coupled with racist immigration laws in USA this is helping smaller companies
like mine to attract far superior talent. I was engineer number 1 in a Machine
Learning division of an American company. I negotiated with my employer that I
will move the whole division to India, hire in India at American salaries and
deliver results.

Since then our ML division is running pretty smoothly and I am able to poach
the brightest kids on the block.

The imminent collapse of India's outsourcing industry will be good for India's
homegrown tech sector as brighter kids will move to work on tougher and more
India specific problems.

With falling birth rates in developed countries and racially charged
environment I think the future of tech will be determined by China and partly
India and not in silicon valley.

~~~
Wohlf
Even with Trump's immigration changes, our immigration standards are equally
if not more liberal than India and much better than Chinese immigration.
Citizens can't even move around China without government approval. Over 13% of
the US population is foreign born, not including the over 11 million illegal
aliens we have.

------
Abishek_Muthian
The issue has to do with Institutions & services firms here in India.

It is normal to see IT Engineers (coders) define they career as X programmer
where it's now time for every programmer to have full-stack skills and treat
programming language as a drill-bit in a tool-box.

Since the services companies benefited earlier by recruiting a graduate and
training them to be X programmer for life, the institutions didn't have a
reason to adapt to changing times because 99% of their students were placed in
these companies and remaining 1 % in Google, MS etc. [Fun note - Sundar,
Satya, Shantanu, Sanjay Jha , George Kurian etc. belong to that 1% and yet
capable enough climb to the top-most seat.]

But I wouldn't buy the 'Indians not hardworking' stereotype,for an average
Indian every opportunity in their life has to be fought for with thousands
(some times millions) of other competitors. I've seen several people who were
the first graduate from their entire family history while living in a hut and
create a sustainable life for them; thanks to these services companies.

But it's time for a change, Institutions should build skills which make their
students recruit-able by startups.

~~~
kamaal
Its strange that you take the names of CEOs and proceed to deduce that as a
proof of them being good programmers. Most of them go to Ivy league
engineering schools, and then Ivy league management schools. And then from
there straight jump into management barely spending any time at all in
engineering. And the whole reason why they do engineering is largely because
they need a bridge course to get into a masters level management degree. Once
you get into a Ivy league management school, going wherever from there is
essentially a networking activity not exactly a great indicator of your
engineering performance. It helps to have friends in high places.

Management positions have long been seen as replacements for IAS.

The 1% you talk about parse XMLs at Google and Microsoft. The 99% parse the
same XMLs at services firms. The 1% thinks they are special because of a
association with a certain Ivy league brand name.

Lets talk of the Indian 1% when somebody in a Indian university writes some
thing the equivalent of a Linux, Perl or FreeBSD.

Lets not over glorify these placement agencies as some institutes of
engineering excellence.

For what its worth the 99% what people generally berudge look down upon
essentially is employed in Indias space programs that sends probes to mars and
moon, built bulk of Indias pretty advanced tech defence infrastructure.

Only thing IITians are good at is self worship.

~~~
fizwhiz
> Only thing IITians are good at is self worship.

It's almost as though you've got an axe to grind with people having any
respectable pedigree.

~~~
kamaal
They did damage to their own selves by flashing their degrees as some kind of
life long privilege, while contributing a net negative to the Indian
economy(As their education is heavily subsidized at the Indian tax payers
expense).

~~~
hsrada
> while contributing a net negative to the Indian economy (As their education
> is heavily subsidized at the Indian tax payers expense).

Below a link to a study from '08 that tried to assess the contribution of IITs
to the economy. Perhaps some numbers might change your mind? (It's incomplete
but includes the executive summary.)

[https://www.ibef.org/download/Content_19dec.pdf](https://www.ibef.org/download/Content_19dec.pdf)

Perhaps an article (from TOI nonetheless)? -
[https://timesofindia.indiatimes.com/india/IITians-
contributi...](https://timesofindia.indiatimes.com/india/IITians-contribution-
to-economy-is-Rs-20-lakh-crore-Study/articleshow/3752658.cms)

Before you dismiss these with whatever reason, perhaps you can show some data
to back up your point?

~~~
kamaal
Amount of non-IITians running/starting industries far exceeds in number. And
they don't get the same funding or training or any human resources help in
return. Of course if you run institutions for decades eventually good people
are going to come out of it. But by and large most IITs are largely places to
train people, and send them to foreign countries. Why should the tax payers
pay for them?

An argument could be made to spend this money to improve public schooling
infrastructure in India. And people coming out of that obviously would
contribute way more. The scenario is a net loss for Indian tax payers. This is
way more in lost opportunity costs.

Most of these arguments sound very similar the arguments against privatization
in 1980s India. You can talk of the benefits of using tax payers money to
manufacture bulbs while you don't invest the same money else where, where some
thing real can happen.

Please feel free to run IITs using fees or whatever endowments you can get.
Also most of these people harp day and night about how awesome they are, makes
sense to generate some IP, sell that and make some money to fund themselves.

~~~
hsrada
> Amount of non-IITians running/starting industries far exceeds in number. And
> they don't get the same funding...

Can you give me a source on this? One that compares the economic contribution
of students from the next-10 colleges in India and finds it to be more than
that of the IITs. Because otherwise, you're comparing different sample sizes
and your statement becomes trivially true as a result.

> But by and large most IITs are largely places to train people, and send them
> to foreign countries.

Try looking up statistics of what % of students go abroad immediately after
graduating from an IIT. Perhaps that might help you revisit this assertion.

> An argument could be made to spend this money to improve public schooling
> infrastructure in India.

The government's already spending 10x on that than they are on Higher
Education. (2009)
[https://en.wikipedia.org/wiki/Education_in_India#Budget](https://en.wikipedia.org/wiki/Education_in_India#Budget)
How much would an extra 0.5x help.

------
kumarvvr
This is fundamentally a value-addition adjustment. For many IT engineers,
their value addition to the project/client/company is very limited, primarily
because most of them are from degree mills and most of them join an IT company
for reasons other than to really work on IT stuff.

There are awesome Indian IT people out there and most of them are gobbled up
by product firms like Microsoft, Facebook, Google, etc. IT services firms are
mostly left with mediocre IT guys whose eye is mostly on "on-site" positions.

Like many have said, it's going to get even more ugly and sincerely I feel
this sort of adjustment is required for Indian IT companies to be ready for
future challenges and future demanding work. They have to shed their bodyshop
images if they have to be taken seriously. It's time to move up the value
chain or die.

~~~
deepaksurti
And really all the blame has to be apportioned to the founding fathers and
what not glorious terms used for the Indian IT body shopping industry leaders?
(Kohli's, Murthy's blah blah)

Sc __w these forefathers for they started on a super negative note with a
begging bowl (probably a hangover of multiple years of colonialism) and
instead not being aggressive for high end work.

Just give me some work was the attitude these fathers started with, no wonder
the son's will do the same. Like father, like son!!!

It is high time the narrative starts changing to cause a change in the mindset
of young engineering students and this has to start at a very low level, from
engineering schools. The first narrative is to show these forefathers in a
more negative light, than positive.

>> It's time to move up the value chain or die.

Die, is the most likely outcome (7/10).

~~~
kumarvvr
Yes. The narrative has to change. And frankly, the culture should move towards
more risk taking.

Barring a few, most startups take a very conservative approach to expansion
and investment.

------
Daishiman
Well, yeah, entry-level IT stuff was always a target for automation because
the human component should have been almost completely unnecessary from the
start.

As the industry matures and execs and staff become aware of the degree of
automation that's possible, they also understand that a lot of the services
offered by consultancy services are mostly fluff and way to add FTEs.

~~~
adrya407
>Well, yeah, entry-level IT stuff was always a target for automation

I see this as a progress. Since you replace the first-level IT stuff with
automated processes, the now second-level IT stuff will sooner or later become
first-level and so on. Therefore all the levels are pushed upwards and we tend
to go to higher levels, no matter if we speak about developing, researching,
improving etc.

~~~
cmurf
At least in this case, 56,000 people in the 1st level lost their jobs. What's
the total number of level 1's who matriculated to level 2? And is there a net
job loss or are the laid off people finding other jobs that pay as well or
better?

Without answers for these and related questions, it's uncertain if this is
good progress.

~~~
shagie
From the source article -
[http://www.livemint.com/Industry/4CXsLIIZXf8uVQLs6uFQvK/Top-...](http://www.livemint.com/Industry/4CXsLIIZXf8uVQLs6uFQvK/Top-7-IT-
firms-including-Infosys-Wipro-to-lay-off-at-least.html)

> Preparing the ground for layoffs, each of these seven companies has already
> put a higher number of employees on notice by awarding them the lowest
> ratings. Cognizant has placed more than 15,000 employees in the lowest
> category (bucket IV), and Infosys has placed more than 3,000 senior managers
> in the category of employees needing improvement.

This isn't 56k entry level jobs. This is 56k jobs up and down the structure of
the companies.

> As IT companies start working on newer technologies such as cloud computing,
> they are fast moving from a people-led model, which means they need fewer
> employees. Meanwhile, many of the IT companies have embraced automation
> tools to perform the mundane, repeatable tasks that were performed by an
> army of engineers earlier.

> “The entire pyramid structure (organizational structure) is getting
> disrupted,” the second HR head cited earlier added.

> That speaks of a bigger problem, said an expert.

> “What required 50 programmers, analysts or accountants 5 years ago can be
> done by a handful of smart thinkers and much smarter systems,” said Phil
> Fersht, CEO of US-based HfS Research, an outsourcing-research firm. “If I
> were Prime Minister Narendra Modi, I would be very concerned that a whole
> workforce generation needs reorienting to address work activities that are
> growing in demand.”

None of the articles speak to where the people who have lost their jobs are
going.

------
scadge
There are approx. 3.1 million employees[1] in India's IT sector. Is 56k (which
is lower than 2%) so much?

[1] [https://www.quora.com/What-is-the-approximate-number-of-
IT-e...](https://www.quora.com/What-is-the-approximate-number-of-IT-employees-
in-India)

~~~
sytelus
US tech companies actually had much larger layoffs however this were again in
very low ends. The high and middle ends are booming as if we are back in 2000
bubble. Due to such disparity one should always clarify what _kind_ of tech
jobs one is talking about.

From
[https://www.bizjournals.com/bizjournals/news/2017/02/17/tech...](https://www.bizjournals.com/bizjournals/news/2017/02/17/tech-
layoffs-surged-in-2016-and-2017-doesnt-look.html)

 _Computer, electronics and telecommunications companies shed more than 90,000
jobs last year, compared to nearly 80,000 in 2015, according to a new report
out from Challenger, Gray & Christmas, a global outplacement firm based in
Chicago. Tech layoffs accounted for 18 percent of the total 526,915 U.S. job
cuts announced in 2016.

Computer companies were hit especially hard; layoffs in the sector were up 7
percent in 2016. Dell Technologies (NYSE: DVMT) was responsible for much of
the uptick when it converged with EMC last year and cut thousands of
positions. Intel (NASDAQ: INTC), IBM (NYSE: IBM), Cisco Systems (NASDAQ: CSCO)
and Microsoft (NASDAQ: MSFT) also shed jobs, with Intel laying off 12,000
employees, or 11 percent of its workforce, per the report._

------
Karupan
Sadly, it's going to get a lot worse before it gets better. As an Indian IT
guy, I was lucky enough to work in product companies all my life. My many
friends in the service industry haven't had that luck. I've heard horror
stories and I've sworn not to work for bodyshop firms.

I feel its a systematic issue - too many IT related courses and seats in
colleges, companies hiring for head count rather than quality, a huge number
of maintenance projects which provide little scope for learning, etc.

Sure the employees do share a part of the blame, but only a part. There is no
incentive for them to change anything in a highly bureaucratic environment, so
this vicious cycle will continue. I just hope the industry as a whole learns
and adapts before its too late and millions lose their job.

------
batmansmk
System integration is a proximity job. The last mile of a software delivery.

With no physical access to their top market (H1B reform), it will continue to
be tough. Capgemini, which has about the same headcount, will end with 30%
more revenue than Infosys in 2017. Accenture, x3.4 the revenue for only x2 the
headcount.

With limited access to market with better hourly rates, they would continue to
struggle. Unless they bet on more vertical market, selling licenses of
software they own or have shares in, which is exactly their current
strategies. It may work.

~~~
fellellor
Those are entirely different business models - services vs products. Companies
aren't always successful in making such transitions.

~~~
user5994461
Infosys, capgemini and accenture are all service companies, re selling
employees by the hour. They don't develop their own products.

~~~
fellellor
If you bothered to read my comment, you'll see that's what I was saying in the
first place.

~~~
akhatri_aus
You're missing the point though, the point s/he's trying to make is Capgemini
doesn't undervalue the price of labour.

------
ryanthedev
The quality of the work has been subpar from what I have seen at my company.

Though the biggest challenge is timezone problems and the sheer challenge it
is to communicate.

Though I'm sure people have had different experiences in their sectors.

~~~
MBCook
The one time I worked with outsourced people from India or Pakistan (I don’t
actually know which country the people were hired out of, could be somewhere
else) was a disaster, but what do you expect when you get the absolute lowest
bid you can?

I know other people have had great success stories, but you get what you pay
for. Even if the cost-of-living is much lower that doesn’t mean that you can
buy the bottom of the barrel people and expect it to be worth it.

------
xstartup
I briefly worked as a contractor for one of the largest ad networks in the
world and we outsourced 20K ad review jobs to South Asia over 3 year period.
But then came advancement in machine learning and now you only needed a few
people to review ads after the adversary networks flagged them.

------
kevin_thibedeau
Are the legions of "recruiters" constantly spamming my phone and inbox part of
IT? I won't shed a tear for them.

~~~
tqdm
Come on these are real people trying to get by. Have some empathy. It sucks
being at the low end.

~~~
Clubber
Most recruiters get paid more than $100K which is better than most IT folks.

[https://www.topechelon.com/blog/how-much-do-recruiters-
make-...](https://www.topechelon.com/blog/how-much-do-recruiters-make-charge/)

------
melling
The claim is that India will be the third largest economy in 2032, as China
becomes #1.

[https://www.bloomberg.com/news/articles/2017-12-26/china-
to-...](https://www.bloomberg.com/news/articles/2017-12-26/china-to-overtake-
u-s-economy-by-2032-as-asian-might-builds)

Hopefully, this is simply a wake up call as the economy grows and diversifies.

~~~
TheAdamAndChe
Economic instability is a large reason for the push towards protectionism in
America. Could those same forces lead to an Indian IT protectionism? Or do
they lack enough industry currently?

------
forkjoin
Given the number of graduates who join the workforce every year in India, plus
the traditional model of companies to maintain a bench for graduate engineer
in anticipation of big contracts, the number doesn't look disproportionate.
Apart from all the politics and shifting revenue targets (which are the
culprit to a great extent), todays technology trends clearly indicates a lot
of "high-valued" job are going to be redundant as well, one report from CBRE
predicts 50% of occupations today will no longer exist in 2025. whats shall
everyone do? skill up . Is that anything new in software development? Nopes,
in my 11 years I have already jumped through hoops of yet another modern day
tech stack a few times to stay afloat.So I'd imagine its not just the low
value IT jobs which are at risk, even the bleeding edge development practices
might face the same fate. Any mobile developer thinking about joining the
blockchain, ML bandwagon? or wait, carpentry anyone? :sigh

~~~
visarga
On the one hand you basically say things will change too much too fast:

> CBRE predicts 50% of occupations today will no longer exist in 2025

But on the other hand, things don't change fast enough:

> whats shall everyone do? skill up . Is that anything new in software
> development? Nopes

These two positions, change and no change, can't be simultaneously true. If
there is change, then there are new applications where humans are needed. If
there is no change, then human jobs remain untaken by automation.

There will never be a lack of jobs for people as long as people have desires
and needs that are unfulfilled. Even if all our needs today are fulfilled, we
create new goals and new entitlements for which we have to work.

Take, for example, medicine and movies - these two occupations existed as pre-
modern medicine and theatre even 1000 years ago. But now, that we have
automated many aspects such as blood tests, pill production, medical scanning,
and in the case of movies, copying and broadcasting - they should reduce the
need for doctors and actors, but instead, they increase 100x the number of
doctors and actors. Why? Because we want more, much more than a millenia ago.

We have expanded our entitlement more than 100x and we're busier than ever, in
the middle of automation. Believe in our desire for more, in our greed and
ever raising entitlement! They'll keep us employed.

~~~
forkjoin
Not entirely sure about your inferences from my comment, I didn't say there
are not going to be jobs, of course there will be jobs. However, perhaps
amidst the Artificial intelligence, jobs will require more creative, social ,
emotional intelligence. Thats where we need to skill up and point I made above
was just to highlight that this re-structuring is not just relevant for todays
low valued work but for the entire spectrum of whats a super-skill today and
going to be "low valued" few years down the line. Also, I'd argue that in the
context of your examples (which are slightly digressing from this thread),
medicine and movies , reason why we have more doctors and actors could
strongly be attributed to the socio-economic growth of the rising population,
a lot more people can/need medical service and go to cinema that what we had
1000 years ago. Technology here solves the problem of efficiency and scale
which is just complementing the progression.

~~~
visarga
I'll try another example. Let's say we automate cleaning of cities. Suddenly
people are going to want drones that can trim trees and bushes, devices that
can clean walls, bots that can scour woods and lakes for plastic and junk, and
100 other things that we didn't have the time and energy to do, but now are
possible. Each of these applications need to be designed, produced, deployed
and managed.

My point is that automation creates new applications, and thus, jobs that sit
on top of it. Like SEO - who would have guessed what SEO is 25 years ago? And
now there is a whole field. We create new desires, we raise our entitlement to
the equal of what we can achieve, no matter how much it is.

------
mac01021
Honest question: is that a lot for a whole country?

~~~
pritambarhate
No. Frankly demand for "skilled" IT professional is high as ever. Even in
traditional tech like .net and Java(spring).

This is just some big IT staffing companies cleaning house.

Source: Anecdotal - I work in Indian IT. In fact hiring for at least 10
positions at my company. It's mainly the skills gap. At these big companies
people get stuck in routine jobs and don't keep up with changing tech
landscape.

------
prakashdanish
As a final year undergraduate, this scares me a lot.

Not sure why this made such big news because this is pretty much evident once
you talk to a majority of cs undergrads, they literally have no idea and
interest in cs but are in it because it is, well, 'trending'.

~~~
RandomCSGeek
As a final year undergraduate, this makes me happy. Finally the trimming that
IT industry badly needs is happening.

And as a domino effect, admissions are also falling. I hope shitty colleges,
like the one I belong from, close down.

Surely, I am having bad time too. I haven't found a job yet. And despite
applying to 50-100 companies, hardly 1-2 replied. But I gotta keep trying,
hopefully I'll find a job one day. If not, well, it's better not to worry
about things out of control. One can always do something to pass that day, and
hope for a better tomorrow.

------
scadge
> For Indian techies, 2017 was the stuff of nightmares.

I still believe qualified engineers had no problems keeping their job or
finding a new one. In any country.

No wonder that unqualified employees will _always_ be laid off _at some time_.

------
steve371
What is the percentage attrition? 2%? I wasn't able to get it clearly from the
article. I think percentage is what we should focusing on instead of the total
numbers considering the total population.

------
senatorobama
Why don't NRI's quit their Bay Area job to come and contribute to the
motherland?

~~~
sumedh
Probably because India cannot match the salaries and quality of life in US.

~~~
senatorobama
I'd argue about quality of life. But definitely absolute income.

~~~
sumedh
Then you would be arguing with facts.

------
coding123
Far more companies are replacing India talent with Pakistan talent. The per
person cost is what India was about 5 - 10 years ago. However, things will
slowly change again, but I'm hoping that these economies start just doing
their own projects and competing at the company level not just the outsourcing
as there are definitely people we should be paying locally to do the work (at
a higher price - remember that extra 1 trillion dollars to the top 500
people?).

------
nautilus12
To be honest, it seems like they have better opportunities with these jobs
available, but these people are probably better off in the long run without
it, and our companies are probably better off not depending on these services
in the first place. Its kind of an unnecessary evil.

There are some jobs I've had in the past that didn't pan out, and I'm glad
they didn't because I wouldn't have grown if I had stayed in them.

------
nocoder
To me, one of the indications that Indian IT is out of ideas & unlikely to
move up the value chain was a string of stock buybacks this year by all major
players. I believe a company invests in stock buyback when it feels that it
does not have any other better uses of the money. Basically, they dont have/
can't find avenues to invest money where the shareholder growth will be much
better than buyback.

~~~
eru
Just as an aside: economically stock buybacks are equivalent to dividends, but
get a better tax treatment in most jurisdiction.

------
NicoJuicy
What I really don't understand is, I'm 1 guy with a very small SMB. I do
everything myself and tried in the cloud.

Except from some maintenance, it just seems to be cheaper to upscale a VM in
many cases.

The biggest cost at my work ( full-time job) seems to be management (
development too off course) and planning.

I'm not sure if the scale that cloud provides is required 90% of the times

~~~
jmalicki
That's exactly the point... there's less for you to manage (at least at
reasonable scale) - you leave management of those people and processes up to
Amazon (or whoever your cloud provider is), so you can focus on your core
business and not get distracted by managing getting new servers, backups,
recovery plans, etc... it "just works".

------
StreamBright
56K is 0.01% of the overall workforce of India.

------
hi41
The article refers to digitisation and automation as one of the reasons for
the layoffs.

Can someone please explain what processes those two terms involve. Does
automation mean writing Unix shell scripts and setting it up under Cron. But
that has been done since very long time. I see don't get what digitisation and
automation mean.

------
thetruthseeker1
One thing I was hoping to get answered is, what is the revenue growth or dip
these companies have seen. I think that may give a better context to this
story. Job loss headlines alone sounds like doom and gloom, but that may or
may not be the case depending on how the money is flowing...

------
kamaal
Those people trying to understand why there is this level of mess in the
Indian IT, let me give you some perspective. India was large a socialist
economy focussed heavily on self reliance before the 1990's. To be precise
1992. This had both good and bad effects. Unions were rampant, production and
engineering were largely focussed on delivering services and schemes
administered through the government. Computerization was its bare minimal as
unions largely thought of automation as some kind massive job killer. Trust me
when I say this the luddite movement back then was so crazy there were
national strikes every time the government tried to anything progressive.

Round about the same time, around mid 1980s, people were tiring as they were
watching west take leaps way ahead of India. There were a few companies
building products and providing services to many firms back then. They were
not exactly very successful but they managed to hang on. Until 1992, when
India opened up its markets. Import regulations were relaxed, and FDI was
encouraged. Round about the same time, US and Europe was gradually outsourcing
bulk of its work to India. These companies thanks to double benefits of both
the sides of domestic and international economy, now experienced run away
success. Early employees tasted success and growth never witnessed in the
history of Indian economics. Companies grew 100% YoY. Head counts increased by
2x every year. Most employees came from middle class to lower middle class
families. These were promoted in waves after waves, year after year. You could
easily net a decent mid to senior management position in 5 - 7 years. They
also got to travel abroad frequently, some of them even settled in US and
Europe. Land prices in Bangalore and rest of India were at scrap levels.
Dollar exchange rate to rupee was 35-40 rupees. So you had a lot of value
available for bird feed prices. Salaries of course were gargantuan. While the
ordinary Indian worker made a average of 5 - 10 K a month, Im talking of the
really well of ones. Software and IT folks made in lacs, bonuses came in lacs.
Stock options came in crores. Back then these kind of riches were unheard in
Indian middle class households, unless you came from politics or bribe giving
government jobs.

IT jobs now became the most sought after jobs in India. Needless to say this
also caused a lot of bad habit to creep into most companies. Almost everybody
aspires to be a manager. Largely because the perks are just too awesome, all
you have to do is forward emails, circulate memos, approve leaves and do
appraisals. It was the Indian private company equivalent of posh sought after
Indian administrative services jobs. You get paid disproportionately more in
all possible ways, Salaries, bonuses and stock options. You also get to travel
business class frequently. Think of it like fully paid luxury vacation every
few months.

Companies now have layers and layers of dead wood unproductive management,
consuming too much resources and providing little to zero value in return.
Most junior level folks are completely unmotivated to pursue a hard career in
tech due to dismal financial prospects. Many mass immigrate to west to catch
up on lost years. Every time US has a recessions these companies benefit as
work gets outsourced. When US economy is good they get shafted.

VCs and US firms largely pay Indian salaries. Start up scene is not bright
either. Most are started by Ivy league folks and graciously over spend all the
cash on paying fat salaries to people from the alma mater. In short, with
money drying up and automation coming in. Management jobs are getting
eliminated. Not enough free money to go around. Many junior level testing and
first/second line support jobs too are going. Next crash will be ugly. People
will lose homes, jewelry will be sold. Kids will be pulled out of
international schools.

They can't be reskilled and re-employed for the same reasons why someone
weighing 150 kgs can't one just wake up and run a ultra marathon. Too much of
entitlement.

Lastly this is just a repeat of the decade of the 1990s. With liberalization
bulk of the people got shafted the same way.

Free money never did any good to people on the longer run.

------
spo81rty
There is also a lot of competition around the world for IT out sourcing
besides India. I have had really good luck using some remote developers in
Uruguay for example. A couple friends out source all of their work to Vietnam
and the Philippines.

------
juanmirocks
If I read the article correctly, mostly or only the low-level jobs in the
industry are laid off. Does this even consider all other low-level personnel
like cleaners? That would make the whole story quite different.

------
Shivetya
Going to be interesting to see what happens to all those in the country as
well. since all this goes back to India it won't be long before the state side
people run into issues

------
fooker
And added about a million. What's the point here?

------
minusSeven
Pleasantly surprised by comments here which were lot more specific and
relevant than the hive mind attitude of Reddit for the same thread.

------
oarla
Hopefully the indigenous market for these skills develops for those affected
to develop a career into.

------
known
Indian IT makes money by selling software engineers, not software to US
clients.

------
mike_hock
> 56k employees

They're laying people off at modem speed!

------
andy-x
56k is soooo old, we have broadband already.

------
tty7
33.6k is still OG

------
yakitori
As someone here has already mentioned, it's more likely due more tech and
indian tech especially moving towards clouds for the derivative cost savings (
less manpower ).

This happened in the US as well. Lots of IT positions got cut as companies
consolidated much of their backend to cloud services.

But I wouldn't hold my breath on cheaper indian tech industry losing any steam
and I'd still betting H1-B visas are only going to be delayed.

India has seen an increase, not a decrease, in FDI ( primarily directed to
their tech sector ). It means that foreign companies/governments/etc are still
investing in the indian tech sector.

------
lawnmover
Ah the same old argument that everything that can be outsourced is cheap and
repetitive. But again we hate the outsourcing industry for taking away our
jobs. Seriously why should someone retain you and pay you top $ in the first
place, if your job was repetitive and lack specialized skills?

And I have hired & worked with multiple consultants at my company. The quality
of the code consultants create is sub-par irrespective of their country of
origin. The end of the day, there don't have any skin in the game, and care
only about the billing.

------
alexasmyths
I wish there was more info on the drivers of this.

Is it less demand from US firms due to slowdown? Market saturation? Shifting
needs?

------
throwaway7749
I'm sorry, but all "talent" I've worked with in India has all been very lousy
and in retrospect makes total sense. You get what you pay for.

I recently left a software company due to their codebase. Low and behold it
was constructed by a bunch of cheap worker ants. Sorry, not for me.

------
ajaimk
1.3 Billion People and a significant number of that work in this industry.

