A friend of mine got laid off just as a new report found 467,000 people got pink slips last month. That puts our national unemployment rate at 9.5 percent, a 26-year high. I talked to my friend Leah, an engineer in Los Angeles, about filing for unemployment, coping with unexpected emotions, and visiting Yosemite. Disclosure: I changed her name to protect her privacy.
What was your initial reaction when your boss told you you were getting laid off?
I sat there for a full minute, quiet, with all these things going through my head…I felt shocked and angry and betrayed and then just confused. I think I finally said “I don’t understand.”
What didn’t you understand?
I didn’t understand why because to everyone’s knowledge in the office we were safe. We had plenty of work. But I found out (in my bosses office) that a big project or two had just recently gone on hold indefinitely. Which totally messed up everything. So they had to make some changes.
Have you ever been laid off before?
No.
How are you coping, two weeks after?
Now I feel fine, comfortable. The first three days were tough. I felt sad but I felt relieved.
Why were you relieved?
In a way I had been somewhat frustrated with the way things were going at the office, personnel-wise, project-wise, and I had had some thoughts about doing something different. But no specific thoughts. I wasn’t searching for anything. The relief was now I can think about these other things in more detail.
Did you see it coming?
I remember about two or three weeks before I got laid off that 25 people in a company in San Francisco that was one of our clients got laid off. I remember being surprised, thinking “Wow I really can’t take this all for granted anymore. I don’t think it really sank in because one of those emotions that went through my head, that still does, is that I felt really foolish thinking that my history with the company and the fact that my project was strong was keeping me safe. My project still is going. It has a source of funding. I felt foolish for linking those things. I took it for granted even after telling myself that I shouldn’t.
How prepared financially were you for something like this?
I have some savings that could probably get me through a couple months so I’m not panicking yet.
Financially, have you done anything different since getting laid off?
I’ve been eating out less, drinking less, making choices that I don’t have to spend as much money. Looking back on my expenses, at least 50 percent were eating out.
Are you cutting out a few things entirely or making reductions across the board?
I will probably cut down across the board and not on anyone thing. I’ll put off big purchases that I otherwise would have gone ahead and done. For example I want a new pair of running shoes. But that’s like $100 give or take so when I got laid off, I said I can live without a new pair of running shoes.
Has your attitude about the recession changed since getting laid off?
I’m definitely more interested in unemployment benefits news and economic stimulus package news because now it actually does affect me or could affect me. I never really paid attention to that before, not for lack of interest but for lack of time.
What are you most concerned about?
To be honest I haven’t started to think very far in the future yet because I am really relived to just be able to live in the moment and relax. It’s summer and I know that I have a little bit of a cushion to take a month to just breathe.
What are you least concerned about?
I’m actually not real concerned about not ever being able to get another job because I feel the market will improve, it may just be a matter of time. I have certain knowledge and strengths and excellent referrals. My bosses have said they would be more than happy to help me out with any references. We left on very good friendly terms.
Do you still have health care?
Yes I got a severance package through the end of July and then I have to figure out COBRA.
What is your plan for the next 6 months?
I haven’t thought more than a month and a half out. I’ve got two weeks until a triathlon race and then I’m going to take about 2 weeks to travel through California, visit friends, go through Yosemite, go through Mammoth. I’ll fly back to New York, go see my parents.
Anything else you want to add?
I did file for unemployment. Haven’t heard anything back. It was easy to file online but I haven’t heard anything. It takes a while.
Showing posts with label Layoffs in India. Show all posts
Showing posts with label Layoffs in India. Show all posts
Sunday, November 8, 2009
Kingfisher lays off 100 Pilots
Mumbai, Nov 4 (PTI) Vijay Mallya-led Kingfisher Airlines is understood to have put close to 100 pilots, mostly trainees, on the chopping block on grounds of huge losses and capacity reduction.
These pilots have completed their probation and all endorsements, but the company has decided not to renew their service contracts in view of the huge losses and capacity reduction, sources told PTI here today.
Their contracts would not be renewed as and when they expire and hence the job cuts would be carried out in a phased manner, they said.
The pilots, who are planned to be phased out, belong to both Kingfisher and the erstwhile Air Deccan, the sources said, adding that they were grounded last year after the merger.
When contacted, a Kingfisher spokesperson denied "sacking" of any pilot. Such measures are "however inevitable due to the market conditions," a company official said.
These pilots have completed their probation and all endorsements, but the company has decided not to renew their service contracts in view of the huge losses and capacity reduction, sources told PTI here today.
Their contracts would not be renewed as and when they expire and hence the job cuts would be carried out in a phased manner, they said.
The pilots, who are planned to be phased out, belong to both Kingfisher and the erstwhile Air Deccan, the sources said, adding that they were grounded last year after the merger.
When contacted, a Kingfisher spokesperson denied "sacking" of any pilot. Such measures are "however inevitable due to the market conditions," a company official said.
Friday, November 6, 2009
Foreign Banks Cut Workforce in India
Foreign and private banks have been cutting down on their workforce in India, according to the profile of banks that Reserve Bank of India released on Wednesday.
The report on the key financial indicators of the bank shows how banks those were on a hiring spree until 2007-08, sacked people to contain costs and improve profitability.
In the case of foreign banks, some such as Standard Chartered, HSBC and ABN Amro have cut their workforce by a few hundred numbers, while private banks, such as ICICI Bank, reduced its workforce by almost 5,500 from 40,686 employees in 2007-08 to 34,597 in 2008-09.
The economic downturn that hit major financial institutions in the country in the past year also affected banks. With the rise in non-performing assets and reducing loan growth, banks were forced to implement a series of cost cutting measures, including trimming of workforce.
According to the report, banks like HDFC and Axis have, however, been recruiting people as their total number of employees has gone up year-on-year. The report that highlights business figures of all the scheduled commercial banks showed a rise in the employee force of all the nationalised banks. Reduced workforce reflected in higher number of business and profit per employee for all the major scheduled commercial banks.
The report on the key financial indicators of the bank shows how banks those were on a hiring spree until 2007-08, sacked people to contain costs and improve profitability.
In the case of foreign banks, some such as Standard Chartered, HSBC and ABN Amro have cut their workforce by a few hundred numbers, while private banks, such as ICICI Bank, reduced its workforce by almost 5,500 from 40,686 employees in 2007-08 to 34,597 in 2008-09.
The economic downturn that hit major financial institutions in the country in the past year also affected banks. With the rise in non-performing assets and reducing loan growth, banks were forced to implement a series of cost cutting measures, including trimming of workforce.
According to the report, banks like HDFC and Axis have, however, been recruiting people as their total number of employees has gone up year-on-year. The report that highlights business figures of all the scheduled commercial banks showed a rise in the employee force of all the nationalised banks. Reduced workforce reflected in higher number of business and profit per employee for all the major scheduled commercial banks.
Some Hiring Some Firing
The economic downturn may have led to heavy job losses in many sectors, but the situation perhaps isn't that gloomy when looking at all the industries together as an average of five companies expanded their workforce for every four cutting down on their staff size.
An analysis of regulatory disclosures about workforces made by companies in India shows that more than half of them hired employees- some in thousands and many in hundreds- even as many others pruned their employee-strength last fiscal.
Out of close to 450 companies for whom employee figures are available for the past two fiscals, the workforce grew for nearly 250 firms, according to an analysis of workforce details compiled by financial data provider Capitalline, which tracks these details from annual reports and other regulatory filings by the companies for their financials.
Together, these companies added more than 1.5 lakh employees during the latest financial year to their workforce, representing a growth of about 7 per cent from about 19.7 lakh in the previous fiscal.
However, this analysis does not take into account the changes in workforce in the current fiscal year which began in April 2009 for a majority of the companies and in January this year for some. There have been reports that many job losses have occurred in the current fiscal year also and these are not reflected in this analysis.
An analysis of regulatory disclosures about workforces made by companies in India shows that more than half of them hired employees- some in thousands and many in hundreds- even as many others pruned their employee-strength last fiscal.
Out of close to 450 companies for whom employee figures are available for the past two fiscals, the workforce grew for nearly 250 firms, according to an analysis of workforce details compiled by financial data provider Capitalline, which tracks these details from annual reports and other regulatory filings by the companies for their financials.
Together, these companies added more than 1.5 lakh employees during the latest financial year to their workforce, representing a growth of about 7 per cent from about 19.7 lakh in the previous fiscal.
However, this analysis does not take into account the changes in workforce in the current fiscal year which began in April 2009 for a majority of the companies and in January this year for some. There have been reports that many job losses have occurred in the current fiscal year also and these are not reflected in this analysis.
Hiring tools for Firing
With a dip in recruitments in the face of economic slowdown, skill assessment tools have now assumed a new and more ‘structured’ role — to help companies internally gauge the capabilities of an existing employee and decide whether he should be trained further, promoted or sacked.
Though the use of these tools for recruitment purposes has taken a back seat now, their demand for internal assessment tests has gone up, said Madan Padaki, CEO of MeriTrac Services. “The ball is now in the employer’s court. He has more choices as the availability of talent in the marketplace is more,” he said.
Skill assessment solution providers are witnessing a 20 to 25 per cent increase in demand from employers for assessing their workforce despite the fact that many of them have become leaner during the downturn, said R Kannan, CEO of Assess People.
“MertiTrac has been handling 90,000-125,000 assessments a month for the past two years. The firm has noticed a sharp rise in enquiries from IT/ITeS, BFSI and retail companies during the past six months. From around 10 enquiries in a quarter, a year ago, MeritTrac has received 25 enquiries for internal assessments each during the last two quarters,” said Padaki.
“Looking at the nature of questions framed for assessment tests, it is evident that at least 25 per cent of them were used to find non-performers, which could be used for downsizing purposes. This trend started only post-October last year,” said Padaki.
Almost 60 per cent of the demand is from IT and ITeS companies.
Organisations are focusing on three areas — effectiveness of training, a framework to determine employee retention and promotion and mapping their career path.
Though the use of these tools for recruitment purposes has taken a back seat now, their demand for internal assessment tests has gone up, said Madan Padaki, CEO of MeriTrac Services. “The ball is now in the employer’s court. He has more choices as the availability of talent in the marketplace is more,” he said.
Skill assessment solution providers are witnessing a 20 to 25 per cent increase in demand from employers for assessing their workforce despite the fact that many of them have become leaner during the downturn, said R Kannan, CEO of Assess People.
“MertiTrac has been handling 90,000-125,000 assessments a month for the past two years. The firm has noticed a sharp rise in enquiries from IT/ITeS, BFSI and retail companies during the past six months. From around 10 enquiries in a quarter, a year ago, MeritTrac has received 25 enquiries for internal assessments each during the last two quarters,” said Padaki.
“Looking at the nature of questions framed for assessment tests, it is evident that at least 25 per cent of them were used to find non-performers, which could be used for downsizing purposes. This trend started only post-October last year,” said Padaki.
Almost 60 per cent of the demand is from IT and ITeS companies.
Organisations are focusing on three areas — effectiveness of training, a framework to determine employee retention and promotion and mapping their career path.
Outsourcing Rises: Captives
Mumbai: The top multinationals banks continue to set up new back office units or expand their existing captive operations in India, even as the model is under criticism for being high cost and less efficient than third-party vendor operations.
Organizations such as Wells Fargo, Ingersoll Rand and Standard Chartered are setting up or expanding their back-office centres in India, reports The Economic Times.
For example, Standard Chartered is setting up a new Knowledge Process Outsourcing (KPO) centre in Bangalore, while Wells Fargo is expanding its captive operations in India for technology services and Business Process Outsourcing (BPO).
According to MarketVista, a Dallas based Everest Research Institute, these three are among the 11 firms that have set up new units or added more staff to their existing units in India during the September quarter, taking the number of captives being set up globally to an 18 month high. Around 28 firms are setting up captive operations in Asia, Europe, and Latin America with India being the most popular destination.
"The numbers of new captives being set up are far more than divestures, indicating a revival in the market," Ameet Singh, Vice President, Global Delivery, Everest. German firm Kontron, one of the world's largest manufacturers of embedded computer technology and a supplier to Original Equipment Manufacturers, is also setting up a contact centre in Bangalore to provide sale and tech support to its Asia-Pacific operations.
"Near-term economic pressures that were there earlier have been reduced. But organisations that reviewed their global sourcing agenda could still be looking at the same outcome, a modified strategy or a more intensive one," said Singh.
The September quarter also saw four captive divestures; UBS' captive to Cognizant Technology Services, AIG's to Mphasis, Schneider Logistics to EXL Services and Kyocera Wireless to MindTree.
According to Singh, the market for outsourcing transactions is seeing two counter forces; lower business volumes and opportunity to reduce costs.
"The companies are attempting to push the envelope further in terms of costs leading to offshoring and outsourcing," said Singh. Based on publicly disclosed transactions, the overall numbers of transactions have fallen to 422 in the September quarter from 467 in the past quarter but contracts from sectors such as financial services have almost doubled from the previous quarter, according to Everest's research.
Apart from financial services, sectors such as healthcare, travel and energy and utilities are also seeing significant rise in demand for offshoring.
"Although there was a marginal decline of 10 percent in the reported global transaction volumes (BPO volumes decreasing by 14 percent and IT sourcing activity reducing by 8 percent), there were signs of improvement in key geographies and verticals," said Everest in the study.
Organizations such as Wells Fargo, Ingersoll Rand and Standard Chartered are setting up or expanding their back-office centres in India, reports The Economic Times.
For example, Standard Chartered is setting up a new Knowledge Process Outsourcing (KPO) centre in Bangalore, while Wells Fargo is expanding its captive operations in India for technology services and Business Process Outsourcing (BPO).
According to MarketVista, a Dallas based Everest Research Institute, these three are among the 11 firms that have set up new units or added more staff to their existing units in India during the September quarter, taking the number of captives being set up globally to an 18 month high. Around 28 firms are setting up captive operations in Asia, Europe, and Latin America with India being the most popular destination.
"The numbers of new captives being set up are far more than divestures, indicating a revival in the market," Ameet Singh, Vice President, Global Delivery, Everest. German firm Kontron, one of the world's largest manufacturers of embedded computer technology and a supplier to Original Equipment Manufacturers, is also setting up a contact centre in Bangalore to provide sale and tech support to its Asia-Pacific operations.
"Near-term economic pressures that were there earlier have been reduced. But organisations that reviewed their global sourcing agenda could still be looking at the same outcome, a modified strategy or a more intensive one," said Singh.
The September quarter also saw four captive divestures; UBS' captive to Cognizant Technology Services, AIG's to Mphasis, Schneider Logistics to EXL Services and Kyocera Wireless to MindTree.
According to Singh, the market for outsourcing transactions is seeing two counter forces; lower business volumes and opportunity to reduce costs.
"The companies are attempting to push the envelope further in terms of costs leading to offshoring and outsourcing," said Singh. Based on publicly disclosed transactions, the overall numbers of transactions have fallen to 422 in the September quarter from 467 in the past quarter but contracts from sectors such as financial services have almost doubled from the previous quarter, according to Everest's research.
Apart from financial services, sectors such as healthcare, travel and energy and utilities are also seeing significant rise in demand for offshoring.
"Although there was a marginal decline of 10 percent in the reported global transaction volumes (BPO volumes decreasing by 14 percent and IT sourcing activity reducing by 8 percent), there were signs of improvement in key geographies and verticals," said Everest in the study.
L&T Infotech In talks to acquire Patni
Bangalore: L&T Infotech, a part of Rs. 40,000 crore engineering and construction major Larsen & Toubro (L&T), is in advanced talks to acquire a majority shareholding in Patni Computer Services, the country's sixth largest software firm. According to sources close to the development, L&T has already completed the necessary diligence and form of the deal is being worked out, reports The Financial Express.
"L&T Infotech has been in talks with Patni for some time now. We have already completed due diligence," confirmed a senior L&T source, requesting anonymity.
The development has come after all three Patni brothers - Narendra Kumar, Gajendra Kumar and Ashok Kumar, finally decided to sell. The Patni brothers together hold around 48.30 percent stake.
In 2007, talks for a similar sale had ended in a standstill, as only Gajendra and Ashok were willing to give their holdings. Narendra has been actively involved in running the business, was not willing to give his share.
Another factor for a sale at this time is that General Atlantic also wants to exit from the company. The private equity firm has about 18 percent stake and had invested $100 million in Patni in September 2002.
The sources from industry said Patni hired Ambit Capital to conduct a valuation of the company.
The analysts said the size of the deal could vary around $1-1.5 billion. The share price of the company has been hovering at around Rs. 450 and it is likely to get Rs. 550-600 per share. Patni's scrip closed at Rs. 456.95, up 4.70 percent, on the Bombay Stock Exchange (BSE) on Wednesday.
"The company has $380 million in cash and equivalents on its books, so an offer price in the range of $1-1.5 billion would be fair," said an IT analyst. Patni had reported revenues of $718.9 million in the last financial year.
"This is a rumor and we do not comment on speculation," said Surjeet Singh, CFO, Patni Computers in an email response.
"I do not want to comment on speculation in the media," said Sudip Banerjee, CEO, L&T Infotech.
According to sources, if L&T Infotech acquires Patni, it would make the combined entity the fifth-largest software firm in India. L&T Infotech is currently stands at 11th place.
However, after been hit by TechMahindra in the bidding for fraud-hit Satyam Computer Services in April, L&T Infotech is being cautious about the Patni deal. But according to analysts, it could not afford to step too cautiously. "L&T Infotech has to move fast. Once the market goes up, say beyond the 20,000 mark, Patni or any other IT company will become a difficult buy," said a source.
AM Naik, Chairman and Managing Director, had said in an interview that he plans to make L&T Infotech a $1-billion company. Facing pressure on revenues from the infrastructure and construction sectors over the last one year because of the economic slowdown, L&T has focused on new drivers of growth, including infotech, power and oil and gas.
"L&T Infotech has been in talks with Patni for some time now. We have already completed due diligence," confirmed a senior L&T source, requesting anonymity.
The development has come after all three Patni brothers - Narendra Kumar, Gajendra Kumar and Ashok Kumar, finally decided to sell. The Patni brothers together hold around 48.30 percent stake.
In 2007, talks for a similar sale had ended in a standstill, as only Gajendra and Ashok were willing to give their holdings. Narendra has been actively involved in running the business, was not willing to give his share.
Another factor for a sale at this time is that General Atlantic also wants to exit from the company. The private equity firm has about 18 percent stake and had invested $100 million in Patni in September 2002.
The sources from industry said Patni hired Ambit Capital to conduct a valuation of the company.
The analysts said the size of the deal could vary around $1-1.5 billion. The share price of the company has been hovering at around Rs. 450 and it is likely to get Rs. 550-600 per share. Patni's scrip closed at Rs. 456.95, up 4.70 percent, on the Bombay Stock Exchange (BSE) on Wednesday.
"The company has $380 million in cash and equivalents on its books, so an offer price in the range of $1-1.5 billion would be fair," said an IT analyst. Patni had reported revenues of $718.9 million in the last financial year.
"This is a rumor and we do not comment on speculation," said Surjeet Singh, CFO, Patni Computers in an email response.
"I do not want to comment on speculation in the media," said Sudip Banerjee, CEO, L&T Infotech.
According to sources, if L&T Infotech acquires Patni, it would make the combined entity the fifth-largest software firm in India. L&T Infotech is currently stands at 11th place.
However, after been hit by TechMahindra in the bidding for fraud-hit Satyam Computer Services in April, L&T Infotech is being cautious about the Patni deal. But according to analysts, it could not afford to step too cautiously. "L&T Infotech has to move fast. Once the market goes up, say beyond the 20,000 mark, Patni or any other IT company will become a difficult buy," said a source.
AM Naik, Chairman and Managing Director, had said in an interview that he plans to make L&T Infotech a $1-billion company. Facing pressure on revenues from the infrastructure and construction sectors over the last one year because of the economic slowdown, L&T has focused on new drivers of growth, including infotech, power and oil and gas.
Saturday, October 24, 2009
India to Receive Big Pay Hike in 2010
Hong Kong: Companies in Asia are set to offer bigger pay rises next year as the region continues to rebound from global recession, notably in India where base salary levels are poised to jump nearly 10 percent. According to a survey by Hewitt Associates, salaries in Indonesia and China will also surge, by 8.7 percent and 6.7 percent respectively, whereas workers in Japan can expect a paltry 2.1 percent pay rise.
The survey, which covered more than 2,000 local and joint-venture companies in the Asia-Pacific region, also states that salaries or annual guaranteed pay this year in Asia's fast-growing economic powerhouses China and India, at 4.5 percent and 6.3 percent respectively, were the lowest since 2005.
Salaries barely grew at all in Hong Kong and Japan, this year as companies cut staff, reports Reuters. More than 60 percent of companies surveyed in Hong Kong, Japan and Singapore froze wage levels, compared with only 26.1 percent in India and 30.8 percent in China.
Next year, only six percent of companies in India and 8.3 percent in China expect to freeze pay compared with 12-14 percent of companies in Japan, Singapore, Hong Kong and Australia.
The survey, which covered more than 2,000 local and joint-venture companies in the Asia-Pacific region, also states that salaries or annual guaranteed pay this year in Asia's fast-growing economic powerhouses China and India, at 4.5 percent and 6.3 percent respectively, were the lowest since 2005.
Salaries barely grew at all in Hong Kong and Japan, this year as companies cut staff, reports Reuters. More than 60 percent of companies surveyed in Hong Kong, Japan and Singapore froze wage levels, compared with only 26.1 percent in India and 30.8 percent in China.
Next year, only six percent of companies in India and 8.3 percent in China expect to freeze pay compared with 12-14 percent of companies in Japan, Singapore, Hong Kong and Australia.
Sunday, September 27, 2009
No Hikes at Infosys
Top IT companies such as TCS, Wipro and Cognizant have kicked off promotions and salary hikes for some employees but the country’s second largest software exporter Infosys prefers to wait and watch till the environment becomes more stable, according to the company’s CEO and MD Kris Gopalakrishnan.
Talking on the sidelines of ICT event Connect 09, Gopalakrishnan also shared his views on the 3-year extension of tax benefits on STPI units proposed by Union Minister A Raja and also a possible solution to counter the recent changes in UK’s immigration norms. Excerpts from the interview:
Some companies in the top five have announced promotions and hikes. When can Infosys employees expect something similar?
The thing is the industry is still facing uncertain times. We would like to look at the situation. As it develops, as it evolves, we are constantly looking at it and then when we decide we will let you know.
Union Minister for IT and telecom A Raja said that he plans to extend the tax benefits on STPI units by another three years from 2011 to 2014. What are your views on the same?
If it is done properly, it is going to help the industry. So, what is needed is extension of the 10-year holiday to 13 or 15 years. Then it will help, because most of the STPs have come out of the 10-year holiday. The 3 year extension will also help but in a smaller way.
As the law stands today, the tax break is available for new units. When you create a SEZ it’s a new unit, when you create a STP, it’s a new unit. So the benefits are available only for new units as it stands today. You need to extend the benefit to existing units by extending the term to 13 years or 15 years.
Recently, there’s also been a lot of noise about stricter immigration norms in UK, where lobbyists are trying to work out rules that will benefit local workers. How will this impact Infosys, for which UK & Continental Europe is the second-biggest revenue generator after US?
Till now, the impact has been minimum. But definitely there is a change in attitude because unemployment is going up in these countries. So, they are looking at how they can tighten their immigration rules. This is also targeted towards illegal immigrants. And what is needed is to make sure that you work with these governments to reduce the impact. India is becoming a very attractive location for overseas people, for foreigners to work in. So we can have a counter agreement with these countries.
And we need to canvass for a different kind of visa, which is a work permit visa. Today immigrant visa is used for work permit. So, it’s confusing the issue, because most employees going there are not going to immigrate. They are just going to work and come back.
Nasscom, CII are working with the govt of India, with these governments to make sure that our perspective, our voices are heard and a proper solution is found. This is also part of the WTO discussions.
Talking on the sidelines of ICT event Connect 09, Gopalakrishnan also shared his views on the 3-year extension of tax benefits on STPI units proposed by Union Minister A Raja and also a possible solution to counter the recent changes in UK’s immigration norms. Excerpts from the interview:
Some companies in the top five have announced promotions and hikes. When can Infosys employees expect something similar?
The thing is the industry is still facing uncertain times. We would like to look at the situation. As it develops, as it evolves, we are constantly looking at it and then when we decide we will let you know.
Union Minister for IT and telecom A Raja said that he plans to extend the tax benefits on STPI units by another three years from 2011 to 2014. What are your views on the same?
If it is done properly, it is going to help the industry. So, what is needed is extension of the 10-year holiday to 13 or 15 years. Then it will help, because most of the STPs have come out of the 10-year holiday. The 3 year extension will also help but in a smaller way.
As the law stands today, the tax break is available for new units. When you create a SEZ it’s a new unit, when you create a STP, it’s a new unit. So the benefits are available only for new units as it stands today. You need to extend the benefit to existing units by extending the term to 13 years or 15 years.
Recently, there’s also been a lot of noise about stricter immigration norms in UK, where lobbyists are trying to work out rules that will benefit local workers. How will this impact Infosys, for which UK & Continental Europe is the second-biggest revenue generator after US?
Till now, the impact has been minimum. But definitely there is a change in attitude because unemployment is going up in these countries. So, they are looking at how they can tighten their immigration rules. This is also targeted towards illegal immigrants. And what is needed is to make sure that you work with these governments to reduce the impact. India is becoming a very attractive location for overseas people, for foreigners to work in. So we can have a counter agreement with these countries.
And we need to canvass for a different kind of visa, which is a work permit visa. Today immigrant visa is used for work permit. So, it’s confusing the issue, because most employees going there are not going to immigrate. They are just going to work and come back.
Nasscom, CII are working with the govt of India, with these governments to make sure that our perspective, our voices are heard and a proper solution is found. This is also part of the WTO discussions.
US Technology Industry loses 1,15,000 jobs in first half of 2009
Seems Indian techies have been luckier than their counterparts in the US. According to a study by TechAmerica Foundation, US technology industry cut 115,000 jobs in the first half of 2009, compared to the 72,900 tech jobs added in the same period in 2008.
However, in the US too, the tech sector seems better than other industry verticals. While between June 2008 to June 2009, tech lost 224,100 jobs, a 3.7% decline; the US private sector shed jobs at a higher pace of 5.1%.
The Washington-based non-profit foundation also said that high-tech manufacturing in the US continues to shed jobs, having lost 69,500 from January to June 2009. The high-tech services sectors shed 45,500 jobs from January to June 2009, a 1% drop.
The report also said that for the first time in its 5-year history, all three services sectors saw losses: engineering and tech services lost 21,500 jobs, while communications services shed 13,600 jobs. In software services the job cuts stood at 10,400.
However, in the US too, the tech sector seems better than other industry verticals. While between June 2008 to June 2009, tech lost 224,100 jobs, a 3.7% decline; the US private sector shed jobs at a higher pace of 5.1%.
The Washington-based non-profit foundation also said that high-tech manufacturing in the US continues to shed jobs, having lost 69,500 from January to June 2009. The high-tech services sectors shed 45,500 jobs from January to June 2009, a 1% drop.
The report also said that for the first time in its 5-year history, all three services sectors saw losses: engineering and tech services lost 21,500 jobs, while communications services shed 13,600 jobs. In software services the job cuts stood at 10,400.
Thursday, September 10, 2009
US Unemployment Rate in July Increases
Job cuts announced by US employers jumped 31 per cent in July to over 97,000, increasing for the first time in six months, warning of a further hike in downsizing activity by the last quarter of the year, a report said on Wednesday.
After falling to a 15-month low in June planned job cuts announced by US employers jumped to 97,373 in July. It was the first increase in monthly job cuts since January, global outplacement consultancy Challenger, Gray & Christmas Inc said here in its latest report.
"After June's surprisingly low job-cut total, a July rebound was not entirely unexpected. While there are signs that the economy is stabilising and the pace of layoffs slowing, we are still a long way from a full recovery. In fact, monthly job cuts are likely to return to levels in excess of 100,000 by the fourth quarter," Challenger, Gray & Christmas CEO John Challenger said.
Job cuts had fallen 33 per cent in June to 74,393, the lowest monthly total since March 2008. The July total was 6 per cent lower than the same month a year ago, when employers announced 1,03,312 cuts. So far this year, employers have announced 9,94,048 job cuts, 72 per cent more than 5,79,260 layoffs through the first seven months of 2008.
The July surge in job cuts was led by firms in the transportation industry, which announced plans to reduce payrolls by 27,954 positions, a five-fold increase from the June layoff total of 5,587.
The telecommunications sector also experienced an increase in layoffs last month with job cuts surging to 17,601 in July from 802 in June.
Meanwhile, the automotive sector, which leads all other industries in year-to-date job cuts with 1,22,212 layoffs has seen layoff announcements decline in each of the last three months. These companies announced 2,716 job cuts in July.
"Declining layoffs in the automotive industry may not be indicative of a turnaround. Instead, these employers simply may not have any room for additional job cuts if they hope to build new fleets of more eco-friendly cars," Challenger added.
With consumer and business spending at a standstill transportation companies have little choice but to make further cutbacks in staffing, it said, adding, that a surge in hiring could take place around the holidays.
Other sectors which saw downsizing during July are government/non-profit (7,131), industrial goods (6,548) and financial (5,030). While economic conditions and cost-cutting claimed over 58,000 jobs, voluntary severance led to 15,070 job cuts in July.
Employers also announced plans to hire a total of 17,183 employees with retail (14,200) and aerospace/defence (1,160) leading the pack.
After falling to a 15-month low in June planned job cuts announced by US employers jumped to 97,373 in July. It was the first increase in monthly job cuts since January, global outplacement consultancy Challenger, Gray & Christmas Inc said here in its latest report.
"After June's surprisingly low job-cut total, a July rebound was not entirely unexpected. While there are signs that the economy is stabilising and the pace of layoffs slowing, we are still a long way from a full recovery. In fact, monthly job cuts are likely to return to levels in excess of 100,000 by the fourth quarter," Challenger, Gray & Christmas CEO John Challenger said.
Job cuts had fallen 33 per cent in June to 74,393, the lowest monthly total since March 2008. The July total was 6 per cent lower than the same month a year ago, when employers announced 1,03,312 cuts. So far this year, employers have announced 9,94,048 job cuts, 72 per cent more than 5,79,260 layoffs through the first seven months of 2008.
The July surge in job cuts was led by firms in the transportation industry, which announced plans to reduce payrolls by 27,954 positions, a five-fold increase from the June layoff total of 5,587.
The telecommunications sector also experienced an increase in layoffs last month with job cuts surging to 17,601 in July from 802 in June.
Meanwhile, the automotive sector, which leads all other industries in year-to-date job cuts with 1,22,212 layoffs has seen layoff announcements decline in each of the last three months. These companies announced 2,716 job cuts in July.
"Declining layoffs in the automotive industry may not be indicative of a turnaround. Instead, these employers simply may not have any room for additional job cuts if they hope to build new fleets of more eco-friendly cars," Challenger added.
With consumer and business spending at a standstill transportation companies have little choice but to make further cutbacks in staffing, it said, adding, that a surge in hiring could take place around the holidays.
Other sectors which saw downsizing during July are government/non-profit (7,131), industrial goods (6,548) and financial (5,030). While economic conditions and cost-cutting claimed over 58,000 jobs, voluntary severance led to 15,070 job cuts in July.
Employers also announced plans to hire a total of 17,183 employees with retail (14,200) and aerospace/defence (1,160) leading the pack.
TCS to hire 25000
Bangalore: In a move that could bring a smile to many faces, Tata Consultancy Services (TCS) has announced that it will hire 25,000 people globally in 2009, with 90 percent of them in India alone. Though the number is bigger when compared to the hiring these days, it is less than last year when TCS appointed around 35,000 people.
With this recruitment drive, TCS also plans to expand its presence into the tier-II cities in India. "We will be hiring 25,000 people this year, which means roughly 25 lakh square feet of work space required and, therefore, we need to grow outside the metros. Tier-II cities are our only focus for expansion in the country as the top rung are clogged and saturated," said Tanmoy Chakrabarty, Vice-President and Head of Government Industry Solutions unit at TCS.
Following this hiring spree, the total global manpower of TCS would go up to more than 1.8 lakh. This will put the IT services provider among large private Indian employers like Tata Steel, which has the total employee strength of two lakh. Going forward, the company, which has an estimated 32 percent market share, plans to cash in on the Indian government's plan to invest Rs. 40,000 crore on IT services.
Currently, 70 percent of the IT segment's revenue is from India, while the rest comes from the U.S., Latin America, Africa and South East Asian countries. However, the revenue contribution from Indian government businesses to the total company revenue of $6 billion is less than five percent, which the company intends to increase to more than 10 percent in the next three years.
With this recruitment drive, TCS also plans to expand its presence into the tier-II cities in India. "We will be hiring 25,000 people this year, which means roughly 25 lakh square feet of work space required and, therefore, we need to grow outside the metros. Tier-II cities are our only focus for expansion in the country as the top rung are clogged and saturated," said Tanmoy Chakrabarty, Vice-President and Head of Government Industry Solutions unit at TCS.
Following this hiring spree, the total global manpower of TCS would go up to more than 1.8 lakh. This will put the IT services provider among large private Indian employers like Tata Steel, which has the total employee strength of two lakh. Going forward, the company, which has an estimated 32 percent market share, plans to cash in on the Indian government's plan to invest Rs. 40,000 crore on IT services.
Currently, 70 percent of the IT segment's revenue is from India, while the rest comes from the U.S., Latin America, Africa and South East Asian countries. However, the revenue contribution from Indian government businesses to the total company revenue of $6 billion is less than five percent, which the company intends to increase to more than 10 percent in the next three years.
Tough for Indian IT Pros in UK
Bangalore: The UK government has accepted recommendations for stricter immigration norms and restricting job opportunities for skilled migrant workers from countries like India, reports Economic Times.
The Migration Advisory Committee (MAC) report submitted by the committee's Chairman, Professor David Metcalf to UK's Home Office last month recommended that the threshold salary levels for allowing entry of a graduate skilled worker be raised from the current 17,000 pounds. This will make it tougher to earn points needed for allocation of work permits.
With more stringent norms, companies like TCS, Infosys, Wipro and Tech Mahindra which serve British customers such as BT, British Petroleum and British Airways by sending Indian professionals to the country on short term project assignments, may now have to look for local UK workers.
"These changes will ensure that businesses can recruit the skilled workers that the economy needs, but not at the expense of British workers, nor as a cheaper alternative to investing in the skills of the existing workforce," Home Secretary Alan Johnson said in a statement issued by the UK Border Agency. He also added that the threshold of income at which migrant workers become eligible for work permits will now be raised to 20,000 pounds.
As per rules, companies will need to advertise for available positions for four weeks before employing migrant workers. "This will mean that, from next year, all jobs must be advertised to British workers in Jobcentre Plus for four weeks - extended from two weeks - before companies can seek to employ individuals from outside Europe. This will ensure that British workers not only are first in line for jobs but also have more time in which to apply," the Home Office said.
MAC's recommendations for tougher intra-company transfer rules - a route adopted by many tech firms for sending Indian workers to work with customers onsite in the country, have also been accepted.
The Migration Advisory Committee (MAC) report submitted by the committee's Chairman, Professor David Metcalf to UK's Home Office last month recommended that the threshold salary levels for allowing entry of a graduate skilled worker be raised from the current 17,000 pounds. This will make it tougher to earn points needed for allocation of work permits.
With more stringent norms, companies like TCS, Infosys, Wipro and Tech Mahindra which serve British customers such as BT, British Petroleum and British Airways by sending Indian professionals to the country on short term project assignments, may now have to look for local UK workers.
"These changes will ensure that businesses can recruit the skilled workers that the economy needs, but not at the expense of British workers, nor as a cheaper alternative to investing in the skills of the existing workforce," Home Secretary Alan Johnson said in a statement issued by the UK Border Agency. He also added that the threshold of income at which migrant workers become eligible for work permits will now be raised to 20,000 pounds.
As per rules, companies will need to advertise for available positions for four weeks before employing migrant workers. "This will mean that, from next year, all jobs must be advertised to British workers in Jobcentre Plus for four weeks - extended from two weeks - before companies can seek to employ individuals from outside Europe. This will ensure that British workers not only are first in line for jobs but also have more time in which to apply," the Home Office said.
MAC's recommendations for tougher intra-company transfer rules - a route adopted by many tech firms for sending Indian workers to work with customers onsite in the country, have also been accepted.
Morgan Stanley Looking at Exiting back office ops in India
Bangalore: U.S. bank Morgan Stanley is exploring the opportunities to exit its back-office operations in India. The bank, which was bailed out by the U.S. government, is looking at its options to sell the back-office unit that does IT development as well as finance and accounting-related work, reports the Economic Times.
Knowledge Process Outsourcing (KPO), equity research, complex financial modeling and portfolio analysis are among the work done here.
According to an investment banker, the potential value of the transaction could be $150-$200 million, in which the KPO operations have a share of $50 million. These operations employ around 2,000 people, of which 500 are KPO employees. Most of the operations are based out of Mumbai and a small part out of Pune.
The value of the deal will also depend on the amount of business the bank will sell. "The annual revenue run rate for Morgan Stanley's captive operations is $70-$80 million. So, the committed business could be around $500 million for five years," said a person with knowledge of the development.
Large Indian IT firms are the expected buyers, some of which already do development work for the bank. These include Infosys, Wipro and KPO firm like eClerx, which works for investment banks, travel and retail industry.
The need to convert fixed costs to variable costs by moving work done at the captive unit to third party vendors is among the factors which drive the sale of many captive units. When the work is outsourced to third party vendors, there is greater flexibility to increase or decrease work without having to hire a fixed number of employees.
Knowledge Process Outsourcing (KPO), equity research, complex financial modeling and portfolio analysis are among the work done here.
According to an investment banker, the potential value of the transaction could be $150-$200 million, in which the KPO operations have a share of $50 million. These operations employ around 2,000 people, of which 500 are KPO employees. Most of the operations are based out of Mumbai and a small part out of Pune.
The value of the deal will also depend on the amount of business the bank will sell. "The annual revenue run rate for Morgan Stanley's captive operations is $70-$80 million. So, the committed business could be around $500 million for five years," said a person with knowledge of the development.
Large Indian IT firms are the expected buyers, some of which already do development work for the bank. These include Infosys, Wipro and KPO firm like eClerx, which works for investment banks, travel and retail industry.
The need to convert fixed costs to variable costs by moving work done at the captive unit to third party vendors is among the factors which drive the sale of many captive units. When the work is outsourced to third party vendors, there is greater flexibility to increase or decrease work without having to hire a fixed number of employees.
Monday, August 24, 2009
Accenture to Lay off 336 senior level managers
Bangalore: Accenture, a business consulting and outsourcing company is likely to lay off around 336 senior-level managers as part of a broad-based restructuring effort. William Green, CEO, Accenture said, "We are taking this step to position Accenture better for both short-term and long-term economic improvement growth and profitability."
The company has about 177,000 employees globally, of which 4,800 are senior-executive employees. The lay off is likely to be completed by the end of November 2009. The company said that the reductions would cost about $247 million in the fourth quarter, which ends on August 31. Out of $247 million, about $128 million of the charge is for severance and related costs of workforce reductions at the senior executive level and $119 million linked to reduction of excess office space. The company said that the space reductions would be completed by the end of August, while the job cuts are expected to be completed in the first quarter of fiscal 2010.
According to a projection by Goldman Sachs Group, global technology spending will decline by eight percent this year. Accenture said that it continued to expect net revenues for the fourth quarter in the range of $5 billion to $5.2 billion with operating margins between 13.4 percent and 13.7 percent. But the company also added that the restructuring charges will likely reduce its earnings per share for both the fourth quarter and the full year by 24 cents.
The company had generated net revenue of $23.39 billion for the fiscal ended August 31, 2008. In the last one year, the stock of Accenture has climbed by 11 percent on the New York Stock Exchange (NYSE).
The company has about 177,000 employees globally, of which 4,800 are senior-executive employees. The lay off is likely to be completed by the end of November 2009. The company said that the reductions would cost about $247 million in the fourth quarter, which ends on August 31. Out of $247 million, about $128 million of the charge is for severance and related costs of workforce reductions at the senior executive level and $119 million linked to reduction of excess office space. The company said that the space reductions would be completed by the end of August, while the job cuts are expected to be completed in the first quarter of fiscal 2010.
According to a projection by Goldman Sachs Group, global technology spending will decline by eight percent this year. Accenture said that it continued to expect net revenues for the fourth quarter in the range of $5 billion to $5.2 billion with operating margins between 13.4 percent and 13.7 percent. But the company also added that the restructuring charges will likely reduce its earnings per share for both the fourth quarter and the full year by 24 cents.
The company had generated net revenue of $23.39 billion for the fiscal ended August 31, 2008. In the last one year, the stock of Accenture has climbed by 11 percent on the New York Stock Exchange (NYSE).
Friday, August 7, 2009
MindTree Cuts Pay
Bangalore: Mindtree has been hit by global economic slowdown as it has cut salaries of some employees by 15 percent. These employees belong to research and development services unit (R&D) and had experience between one to seven years. "(Employee) utilization in the division has now fallen to 60 percent, so we have reduced pay by 15 percent for some staff. It is necessitated by the fact that utilization has been below the expected level," said Puneet Jetli, Senior Vice President and Head, Global People Function, Mindtree to SiliconIndia in a telephonic interview. The cut is applicable from August 1, 2009, and affect about 150-200 people out of the total 7800 employees.
Employees facing this decision are the ones who have been not on project for more than 30 days. Out of the six business unit in Mindtree, R&D unit has been hit hard due to economic slowdown. "R&D consists of customers who build product in technology sector. These customers are people who revolve around semiconductor industry. Semiconductor industry has been worst hit due to recession," says Jetli, who believes that in times like these their customer don't make many products, that's the reason why only R&D unit has been hit.
Jetli also added that there are two ways an employee facing pay cut can start getting his salary back. One is if they themselves start getting assigned to customer projects and the second is if the R&D unit crosses 65 percent utilization.
The company has reported revenue of Rs. 3.05 billion, up 36 percent from a year earlier. It also posted a net profit of Rs. 567.3 million in the June quarter. But in the quarter ended June 30, R&D contributed only 14.1 percent of Mindtree's revenue as compared to 17.7 percent in the previous quarter.
Many Indian software companies have been hit in past few quarters and customers in U.S. and Europe are looking for much cheaper options for product and services. Already, Tata Consultancy Services (TCS) and Infosys have reported a decline in staff numbers for the June quarter. Mahindra Satyam and Hexaware Technologies have asked few employees who are not working on active assignments to take a long leave. "We did not want to send people to virtual pool or layoff. So this is just the short term process. Some organizations have put their employees on 40-50 percent salary. We did not want to take any such drastic action," added Jetli.
If the situation does not improve in the R&D unit it is possible that number of people facing a pay cut might increase. At the company's first quarter results announcement last month, MindTree Chief Executive Krishnakumar Natarajan had predicted that the company expects the growth to be muted in the next few quarters. This move by Mindtree proves that the company might have to make many changes to fight and adapt to the slowdown in Indian IT sector.
Source: Silicon India
Employees facing this decision are the ones who have been not on project for more than 30 days. Out of the six business unit in Mindtree, R&D unit has been hit hard due to economic slowdown. "R&D consists of customers who build product in technology sector. These customers are people who revolve around semiconductor industry. Semiconductor industry has been worst hit due to recession," says Jetli, who believes that in times like these their customer don't make many products, that's the reason why only R&D unit has been hit.
Jetli also added that there are two ways an employee facing pay cut can start getting his salary back. One is if they themselves start getting assigned to customer projects and the second is if the R&D unit crosses 65 percent utilization.
The company has reported revenue of Rs. 3.05 billion, up 36 percent from a year earlier. It also posted a net profit of Rs. 567.3 million in the June quarter. But in the quarter ended June 30, R&D contributed only 14.1 percent of Mindtree's revenue as compared to 17.7 percent in the previous quarter.
Many Indian software companies have been hit in past few quarters and customers in U.S. and Europe are looking for much cheaper options for product and services. Already, Tata Consultancy Services (TCS) and Infosys have reported a decline in staff numbers for the June quarter. Mahindra Satyam and Hexaware Technologies have asked few employees who are not working on active assignments to take a long leave. "We did not want to send people to virtual pool or layoff. So this is just the short term process. Some organizations have put their employees on 40-50 percent salary. We did not want to take any such drastic action," added Jetli.
If the situation does not improve in the R&D unit it is possible that number of people facing a pay cut might increase. At the company's first quarter results announcement last month, MindTree Chief Executive Krishnakumar Natarajan had predicted that the company expects the growth to be muted in the next few quarters. This move by Mindtree proves that the company might have to make many changes to fight and adapt to the slowdown in Indian IT sector.
Source: Silicon India
Saturday, August 1, 2009
Indian IT the Trends on Emplyment
The Quarterly Results of Top Indian Companies are out, some of them have done well in terms of profit growth however what needs to be seen is that the employment numbers (Net Additions) for almost everyone is negligible or Negative.
The Big Indian IT Companies were growing at 30% plus in revenue terms and hiring 10,000-20,000 Freshers each, the attrition rate was also high as emplyees left for better opportunities elsewhere.
Now the situation has completely reversed, the number of emplyees has actually come down for most of the biggies rather than going up, this despite of the fact that fresher and lateral hiring in niche areas is still continuing, this infact lays bare the claim of these companies that they are not laying off.
For the IT worker this is a time for self realization, it is true that 20-30% of the workforce would be performing below performance standards and the weeds need to be rooted out, however the employees need to introspect and see themselves in the mirror, that instead of wasting the bench time on gossips and playing games if they had done technology upgradation of their skills they would still be having a job. The Emplyees are as much to blame for a layoff as no sensible company would throw out good people, and even if they are thrown out there are enough opportunities in the market to go to.
The Big Indian IT Companies were growing at 30% plus in revenue terms and hiring 10,000-20,000 Freshers each, the attrition rate was also high as emplyees left for better opportunities elsewhere.
Now the situation has completely reversed, the number of emplyees has actually come down for most of the biggies rather than going up, this despite of the fact that fresher and lateral hiring in niche areas is still continuing, this infact lays bare the claim of these companies that they are not laying off.
For the IT worker this is a time for self realization, it is true that 20-30% of the workforce would be performing below performance standards and the weeds need to be rooted out, however the employees need to introspect and see themselves in the mirror, that instead of wasting the bench time on gossips and playing games if they had done technology upgradation of their skills they would still be having a job. The Emplyees are as much to blame for a layoff as no sensible company would throw out good people, and even if they are thrown out there are enough opportunities in the market to go to.
Microsoft to cut 1% Workforce in India
Software giant Microsoft announced its plans to cut 1% of its Indian staff as its net income declined 11% during the December quarter because of worldwide economic slowdown.
The declaration on this is part of the Redmond-based company's decision taken during January 2009 to slash around 5,000 jobs worldwide by June 2010 in order to save up to $700 million (Rs 3,500 crore).
The job cuts in India are part of the second round.
In India, the company's decision will impact around 55 people across Microsoft's six-business divisions spread across Bangalore, Delhi and Hyderabad.
In a major declaration, the company said, "Due to a global realignment of our business priorities, about one percent of the net rolls across India are likely to be impacted. These adjustments reflect the necessary changes to ensure that the right resources are focused on the right priorities."
When asked to give detailed information, the company's spokesperson declined to comment saying "We are currently working with the concerned employees to evaluate alternative positions internally and where applicable look at mutually favourable disengagement terms."
In a 10-Q filing to the Securities Exchange Commission on April 23, Microsoft said that it had reserved around Rs 1,200 crore for severance for 3,400 laid-off employees, "all of whom are expected to leave the company by June 30, 2010".
By: News
The declaration on this is part of the Redmond-based company's decision taken during January 2009 to slash around 5,000 jobs worldwide by June 2010 in order to save up to $700 million (Rs 3,500 crore).
The job cuts in India are part of the second round.
In India, the company's decision will impact around 55 people across Microsoft's six-business divisions spread across Bangalore, Delhi and Hyderabad.
In a major declaration, the company said, "Due to a global realignment of our business priorities, about one percent of the net rolls across India are likely to be impacted. These adjustments reflect the necessary changes to ensure that the right resources are focused on the right priorities."
When asked to give detailed information, the company's spokesperson declined to comment saying "We are currently working with the concerned employees to evaluate alternative positions internally and where applicable look at mutually favourable disengagement terms."
In a 10-Q filing to the Securities Exchange Commission on April 23, Microsoft said that it had reserved around Rs 1,200 crore for severance for 3,400 laid-off employees, "all of whom are expected to leave the company by June 30, 2010".
By: News
British Telecom to cut 2,750 call center jobs in India
British telecom giant BT will transfer more than 2,000 call centre jobs from India back to the UK, chief executive Ian Livingston revealed during the firm's annual general meeting at the Barbican Centre in London.
BT will transfer at least 2,000 jobs to Britain from India, where it employs 11,000 customer service staff. However, the eventual number of job cuts in call centres will be closer to 2,750, representing half the group's 5,500 call-centre staff in India, the Times reported on Thursday.
The firm, however, insisted that its move had nothing to do with the quality of service offered in India. "This is not about customer service, as the service in our operations around the globe is of very similar standards. It is about the effective deployment of our resources. We have opportunities to bring some activities, carried out by our partners, back from outside the UK to permanent BT employees in the UK who are skilled to do this work," a company spokesperson said.
The pullout of jobs from India would be phased with no specific timescale set for the transfer of jobs. "This is part of a long-term strategy to reduce costs and the dependency on third parties globally," the spokesperson added.
Industry watchers in Bengaluru said the move would keep the local population, struggling with a deep recession, happy. Unemployment in the UK is at its highest in the last one decade and salaries have dropped - so has India's cost advantage.
Managing partner of consulting firm Browne & Mohan Dr. T.R. Madan Mohan says that while Indian firms charge about $18 per resource, in the UK charges have dropped to $22-23 per resource from $33 in December last year. "However, technology work, which requires high skills, may continue to be outsourced. BT had axed 6000 jobs last year in the UK and much of this work came to Tech Mahindra and HCL," he says.
The firm, he adds, was looking at more high-end outsourcing and may consider players such as Patni, HCL, Infosys, and Subex.
The primary hit for Indian IT services vendors - mostly the top five players - will come when low-end work contracts are not renewed next year, says engagement manager with Zinnov Karthik Ananth. A spokesperson said that by next year, approximately 4,000 less people will be contracted in India than was the case in early 2008.
"The BT Global Business Services division, which mainly offshored to APAC countries, has been a loss making unit. The rationalisation of headcount would be to cut costs and scale down operations," he says.
In May, BT had announced that it will cut 15,000 more jobs this year after it reported a pre-tax loss of £1.34bn for the 12 months till March 31.The telecom giant had cut 15,000 jobs last year.
Last year, the majority of the job cuts were in the area of indirect labour, including agency, contractors, subcontractors and offshore workers, including those based in India. The telecom giant has a global workforce of 150,000 and employs 90,000 directly in the UK.
The firm has steered clear of compulsory layoffs in Britain and hoped to cut the jobs through natural wastage and voluntary redundancies.
Source: Asian Age
BT will transfer at least 2,000 jobs to Britain from India, where it employs 11,000 customer service staff. However, the eventual number of job cuts in call centres will be closer to 2,750, representing half the group's 5,500 call-centre staff in India, the Times reported on Thursday.
The firm, however, insisted that its move had nothing to do with the quality of service offered in India. "This is not about customer service, as the service in our operations around the globe is of very similar standards. It is about the effective deployment of our resources. We have opportunities to bring some activities, carried out by our partners, back from outside the UK to permanent BT employees in the UK who are skilled to do this work," a company spokesperson said.
The pullout of jobs from India would be phased with no specific timescale set for the transfer of jobs. "This is part of a long-term strategy to reduce costs and the dependency on third parties globally," the spokesperson added.
Industry watchers in Bengaluru said the move would keep the local population, struggling with a deep recession, happy. Unemployment in the UK is at its highest in the last one decade and salaries have dropped - so has India's cost advantage.
Managing partner of consulting firm Browne & Mohan Dr. T.R. Madan Mohan says that while Indian firms charge about $18 per resource, in the UK charges have dropped to $22-23 per resource from $33 in December last year. "However, technology work, which requires high skills, may continue to be outsourced. BT had axed 6000 jobs last year in the UK and much of this work came to Tech Mahindra and HCL," he says.
The firm, he adds, was looking at more high-end outsourcing and may consider players such as Patni, HCL, Infosys, and Subex.
The primary hit for Indian IT services vendors - mostly the top five players - will come when low-end work contracts are not renewed next year, says engagement manager with Zinnov Karthik Ananth. A spokesperson said that by next year, approximately 4,000 less people will be contracted in India than was the case in early 2008.
"The BT Global Business Services division, which mainly offshored to APAC countries, has been a loss making unit. The rationalisation of headcount would be to cut costs and scale down operations," he says.
In May, BT had announced that it will cut 15,000 more jobs this year after it reported a pre-tax loss of £1.34bn for the 12 months till March 31.The telecom giant had cut 15,000 jobs last year.
Last year, the majority of the job cuts were in the area of indirect labour, including agency, contractors, subcontractors and offshore workers, including those based in India. The telecom giant has a global workforce of 150,000 and employs 90,000 directly in the UK.
The firm has steered clear of compulsory layoffs in Britain and hoped to cut the jobs through natural wastage and voluntary redundancies.
Source: Asian Age
Saturday, May 30, 2009
Infy: 1500 Resumes in Job Market
Bangalore: The slowdown has proved to be a hard ground for the survival of the employees in Infosys, who have resorted to consultancies to seek new jobs. More than 1500 employees of Infosys have filed their resumes on various placement firms, in the last two months.
"Around 1300 resumes have been posted by Infosys employees, of which many of them are in the level of project managers," said Kris Lakshmikanth, Founder CEO and Managing Director, Head Hunters. HRM Consultants, a consultancy firm have received around 60 resumes. "During the last few years, resumes from Infosys were very rare, but this year we have received quite a few," said G.S.Lakshmiprasad of HRM Consultants.
There are other placement centers like HROne, Magnum Consultants and CR Executive Search, which saw many Infosys employees posting their resumes. Adding on to the insecurity, Infosys has laid off around 2100 people owing to non-performance.
Commenting on the sudden layoff, Ruchi Gopal of Magnum Consultants said, "Companies will see their balance sheet, so, handing pink slips to the employees is fair, if they were given proper notice period prior to the layoff."
However, the layoff happened without any prior notice to the employees. According to an employee who has been fired, they were called for a meeting with HR managers, and were immediately given two options either to resign voluntarily or get terminated. "
The company is especially, getting rid of the project managers. If a project manager had been handling 25 people, now he will have to manage 50 people as they are reducing the bulk," said Lakshmikanth.
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