Tuesday, October 14, 2008
Mad rush for information technology courses runs out of steam

Chennai: Engineering college admission earlier this year showed more students opting for mechanical and civil engineering than in the previous years, with the mad rush for an information technology-related stream slowing down.

Similarly, many students graduating from these courses are opting to wait for core sector jobs, instead of jumping into the IT industry.


“Information Technology is no longer a sunrise industry,” says Srinivas Kandula, global head of human resources at iGATE Global Solutions. The evidence for his statement may be found on college campuses.

Many core engineering companies have increased their compensation packages to match, or even top, the salaries offered in the IT sector, while most mass software recruiters have stuck to the same salary offered last year, says S. Mohamed Tajudeen, placement officer at Crescent Engineering College.

The result is that “none of our civil engineering students is opting for IT jobs this year. All have been placed in the infrastructure industry.”

“Most of our mechanical and civil engineering students are waiting for core industry recruiters rather than snapping up the first IT job that comes their way,” says Arun Ramaswami, placement officer at Velammal Engineering College. IT jobs are not as plentiful anyway.

With the U.S. economic crisis threatening to affect their projects, Indian IT firms have pruned their mass hiring plans.

So, is the opposite of sunrise, a sunset? No, but the current economic situation has forced the process of change, at least in respect of human resources, from an emergent industry scrabbling for quantity to a consolidating industry selective about quality.

Again, the evidence is on college campuses. “We have cut down on the number of campuses, but we recruited in 14 of the top 20 colleges ranked according to last semester’s [examination] results,” says a senior executive of a large IT major.

The IT industry had witnessed a headcount-based growth, which will change given the current situation, says Mr. Kandula.

Instead of working on the principle of more people equals more effort, hence more cost, the IT industry will move towards output-based pricing. The price of a project will be determined on the basis of the output, which will be measured in terms of quality standards and pre-defined metrics.

The focus will shift to quality, irrespective of how many people do the job.

IT services firms will pass this on to employees, says Mr. Kandula. For example, the performance-based component of pay packages will rise from 40 per cent to 60 per cent. This will be integrated into HR policy, he predicts.

The trend will also be to move to just-in-time hiring, instead of hiring on the basis of future expectation, says V. Suresh, senior vice-president at naukri.com., a leading job search website. The focus will be to recruit quality candidates to ensure that everyone works all the time at the optimum level. In such a situation, Mr. Suresh says, job applicants must assess their interests, to understand where they can work to tap their skills to the maximum. Niche skills will be in high demand.

So what are the new sunrise industries, those emerging sectors, which are likely to be booming when today’s students join the job market in a few years? Telecom, infrastructure, mining, power, construction, hospitality, healthcare, pharmacy and manufacturing design are some of the likely contenders, reckons Mr. Suresh.

These sectors may keep growing despite the economic slowdown, he feels. Mr. Kandula puts his bets on media, entertainment and travel, besides hospitality and construction.