As economies slump, techies fear major layoffs near future

Projects in the aviation and auto sector are being benched, claimed an employee of a reputed company with office in Sholinganallur.
A view of the deserted OMR IT corridor in Chennai | shiba Prasad sahu
A view of the deserted OMR IT corridor in Chennai | shiba Prasad sahu

CHENNAI: Techies in the city are anxious about their career prospects. With the US, Europe, Australia, and Singapore still under lockdown, an IT employees union has raised alarm claiming that signing of new projects is either getting cancelled or postponed.

Projects in the aviation and auto sector are being benched, claimed an employee of a reputed company with office in Sholinganallur. “No employee has been sacked as yet. We are being taken care of now, during the lockdown, but we have no idea what the future holds for us,” he said.

Aditya Narayan Mishra, CEO of the HR services firm CIEL, predicts that there could be layoffs anywhere between 1,00,000 to 1,50,000 in the IT sector, which includes both large and small firms. Mishra says bigger firms can weather the crisis and only 5 to 10 per cent workforce may take the hit. “It all depends on how the companies will weather the crisis in the next 60 weeks,” he said.  PR Vignesh Raja, owner of Fusion Global Solutions, a Chennai-based IT and manpower outsourcing company, says around 40 to 50 per cent businesses in the eastern United States have been hit.

“We are also not able to collect our revenues from the clients. As a result we are not able to pay back our vendors, who have to be paid bi-monthly as part of the contract,” says Vignesh. “We managed for the month of March but April will be a difficult. The government has to step in and help us.”

Sources say the least hit have been banking and healthcare based projects, but even there, on-site works are shut for the next six months. Parimala, president of the union, Forum for IT Employees (FITE), says employees are under tremendous pressure. “The sector employs over 40 lakh people. Even a 5-10 per cent slash will leave lakhs jobless.”  

“In addition, we have thousands already in the bench waiting for new project allocations. What will happen to them?” People in the bench is a unique concept in the IT sector, keeping a resource pool at bay to sign new projects easily.

‘Don’t force resignations’
FITE has demanded the governments to urge IT firms not to make their staff forcefully resign from services, and to declare such practices as illegal. Nasscom refused to comment on the issue.

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