Top Indian IT firms' witness the headcount falls

A report says, the employee headcount of Top Ten Indian IT Firms witnessed a collective drop for the first time in over 25 years. The report from Mint says, the headcount fall by 51,744 in the first six months of the fiscal year 2024.

This is the first time in 25 years that the Indian IT industry has seen an overall decline in headcount. The workforce has also fall to 2.06 million people at tne end of September from 2.11 million at the beginning of the fiscal year, resulting in a loss of 51,744 jobs.

All credits to the new age technology disruptions, Generative AI has played a role in the reduction of employee headcount in the top ten Indian IT firms in recent years. This is due to the fact that generative AI can be used to automate many tasks that were previously done by humans, such as:

Generative AI, built on large language models (LLMs) that synthesize vast troves of data to generate text, images and more, hit the news late last year and is seen as the biggest technological leap since the web browser and smartphones. Businesses are rolling out generative AI tools to assist employees in doing everything from writing computer code to drafting emails.

As generative AI becomes more sophisticated and widely adopted, it is likely to have a further impact on employment in the IT sector. However, it is important to note that generative AI is also creating new jobs, such as AI engineers and trainers.

The decline in headcount is attributed to other factors, including:

# Slowing growth in the global economy

# Increased competition from foreign IT firms

# The rise of automation and artificial intelligence

A subject matter expert says, These are testing times for the IT behemoths."

"Changing deal types, pressure on margins, and looming uncertainty leave very few options for them when it comes to the talent strategy.

Finally, the Indian IT industry is a major contributor to the Indian economy. The decline in headcount could have a negative impact on the Indian economy. However, the industry is still expected to grow in the coming years, which will benefit the Indian economy.

Dr. Deepak Kumar Sahu, President & CEO, VARINDIA