NEW DELHI (The Statesman/ANN News Desk) - India's fabled romance with the software industry may be ending thanks to increasing automation and thrust on artificial intelligence in its operations and projects.
That India's IT industry may be losing its swagger has come to the fore again with 37,915 engineers leaving software major Infosys.
A whopping 37,915 engineers have left Infosys while the company's hiring has plunged 65 per cent in fiscal 2016-17, the Statesman has reported quoting IANS.
India's fabled romance with the software industry may be ending thanks to increasing automation and thrust on artificial intelligence in its operations and projects.
India registered stellar growth in the IT industry at the turn of the century with its software professionals helping fix the Y2K bugs. The pogrammers had a smooth good ride for a good 17 years till they hit a dead end.
Industry observers saw the end coming when another software major Tata Consultancy Services announced a virtual stalling of its services in the middle of 2017. Newer digital technologies were replacing the software stars of India.
The Indian software export industry is worth US$110 billion. According to various media reports, it employs around 4.25 million people and has a 60 per cent market share of global outsourcing and is globally dominant.
"Of the 10 top software service companies globally ranked by market cap, five are Indian. Of the top five, three are Indian. All of them have a massive presence in India. Of the total number of employees, amounting to nearly 2 million, in these top 10 companies, about 70 per cent are based in India or travel out of India. The Indian offshore software industry dominates the software services world and has no parallel," NDTV reported.
The reasons for the industry's demise are many.
"A slowdown alone wouldn't have stopped the Indian industry if it had been able to embrace 'smac,' or social, mobile, analytics and cloud-based technologies. But the vendors wasted so much time defending their legacy business of writing code for and maintaining purpose-built enterprise applications that they failed to make a mark in the new digital world," Bloomberg reported.
While most have written the obituary for the IT industry, there are some still batting for it despite the obvious statistic.
"All talk of demise based on a quarter or based upon a lower growth rate are figments of overactive imaginations," says Mohandas Pai, who once headed the HR department in Infosys.
But newest figures from Infosys are telling of where the industry is headed.
According to the employee metrics the outsourcing firm disclosed on Thursday, 37,915 left the company and its subsidiaries worldwide during the fiscal under review (FY 2017) as against 34,688 in the previous fiscal (2015-16).
Though the Bangalore-based company hired (gross addition) 44,235 techies in FY 2017 as against 52,545 in FY 2016, the exodus led to the net addition slump to 6,320 for the year as against 17,857 in the previous year, a whopping 65 per cent decline.
Net addition for the fourth quarter (January-March) was 601, while it was negative or minus 66 in the third quarter (October-December) and 661 in Q4 year ago.
Hiring of laterals (seniors with 10 or more years of experience) also declined to 18,979 in the fiscal under review (FY 2017) from 24,719 in FY 2016.
The company's total headcount for FY 2017 increased 6,320 to 200,364 from 194,044 in FY 2016.
As a result, attrition for the parent company (Infosys) increased to 15 per cent in FY 2017 from 13.6 per cent in FY 2016 on annualised basis.
On consolidated basis, annualised attrition of the parent company and its subsidiaries worldwide increased to 19.2 per cent in FY 2017 from 18.7 per cent in FY 2016.
"Attrition declined sequentially to 13.5 per cent in fourth quarter from 14.9 per cent in third quarter in the parent company, reflecting our focus on better employee engagement," said Chief Operating Officer (COO) U.B. Pravin Rao in a statement.
"Utilisation rate also reached 84 per cent, which is the higher in Q4 over the past several years," recalled Rao.
Consolidated attrition also declined to 17.1 per cent in Q4 from 18.4 per cent in Q3.