BANGALORE: The National Association of Software and Service Companies (Nasscom) is playing matchmaker between IT companies looking to lay off employees and those that want to recruit.
“We have already held some meetings which have yielded positive results,” Nasscom president Som Mittal said on the sidelines of a two-day IT Women Leadership Summit 2008 in Bangalore that began here on Wednesday.
Such meetings have been held in major cities such as Kolkata and Mumbai, Mittal said, but refused to reveal the number of participating companies.
“Some IT companies will definitely lay off employees. However, there are many others which are still recruiting. We do not expect mass layoffs,” he said.
TCS, Wipro and IBM are among the companies that have laid off staff this year.
According to Mittal, hiring in the Indian IT industry has slowed down and the current global economic crisis will be a drag on the growth momentum for three-four quarters.
“We are at a downturn, which would impact our growth rate. There will be three-four quarters where growth rate will be uncertain, lower than 30%. And post that, we will spring back,” he said.
“Hiring is slowing down because of several factors. Attrition is lower. Efficiency is getting improved, but people are back in the campus for next year. If they did not have confidence to use those resources next year, why should they go to the campus and create a problem?” Mittal asked.
The Indian IT industry is mature enough to handle the slowdown and come out with solutions to ensure that the lay offs will not be massive, Mittal said.
He said the industry is committed to recruitments and lay-offs will be temporary.
“Many IT companies see the slowdown as an opportunity. They believe that more overseas companies will look to outsource work to India going ahead as India offers significant cost advantage,” he said.
Nasscom is currently reviewing its growth projection for this year from the earlier 21-24%. “We have said we will tell you in December. We have no basis to give a number today. We are doing our research. Why give a knee jerk?”
According to a Gartner report titled ‘Forecast: IT Services, Worldwide, 2008-2012 Update and Worst-Case Scenario’, governments across the world and the financial industry will be agile enough to develop solutions that mitigate economic shock. The report goes on to say that IT services can be sold in both good times and bad, but it requires agility and ability to create opportunity.
Despite the slowing US economy, growth in IT services is expected to remain solid in all the forecast years, with a CAGR of 7.8% from 2007 through 2012. Supply-side indicators remain strong with both Accenture and IBM reporting strong third quarter results.
n_pranav@dnaindia.net
