Impact of global crisis on hiring in Indian IT and ITES

September 12, 2011: As global economic crunch is expected any time, many Indian outsourcing companies are focusing on revising their HR policies.

Yes, Indian companies particularly in the Information Technology and Business Process Outsourcing sector are planning on building strategies to overcome the anticipated threat of economic slowdown. Today companies are very conscious and don’t want to take any unwanted risk. At this point of time the impact of global crunch may force Indian firms to slow down the recruitment process.

According to an expert, in the current scenario global business is dull, especially in the US. Most of the Information Technology (IT) and Business Process Outsourcing (BPO) service providers in India mostly deal with US clients and because of that the Indian vendors anticipating the impact on offshore market is quite genuine. At this point of time most preferred option for Indian service providers is to take steps to reduce risk. It was in 2008 that we witnessed companies adopting strategies such as downsizing and cost cuts. In 2011 the rate of cost cutting and downsizing may be much less comparatively but it is not avoidable, he added.

As far as Indian IT and BPO firms are concerned, the trend has drastically changed from few years back. Earlier India was the best option for any global client who looks forward to tap the benefit of immense cheap labor available in the nation, but today the situation is not the same. Global companies who seek the service of vendors look into many factors such as quality, timely delivery, innovations and etc apart from cheap labor. As concentrating on such varied factors more global players are finding it comfortable to get into business contracts with other markets such as Philippines and South Africa. This encourages Indian companies to promote integrated offshore, near shore and on shore benefits to the clients and also to minimize their expenses and maximize the turnover. Such situations also lead them to take strategic decisions such as revised HR policies.

Even though Indian IT and BPO firms might not completely shut down the hiring practices, the strategic decision may badly effect young graduates who seek to begun there carrier in the nation, particularly in the IT and BPO sectors. IT firms, particularly in cities such as Bangalore, Chennai and Delhi are focusing on hiring graduates from top schools only so as to reduce the time and extra investments required for training.

Its about to be a crucial situation ahead in the Indian IT, ITES and BPO sector as far as fresh recruitment is concern, but the sector has an history of quick recovery in 2008 and experts expects that to be repeated this time too.




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