Top IT firms bracing for huge lay-offs

Bangalore: If market guestimates are anything to go by, the latest happenings in the global financial markets can result in the loss of as many as 20,000 to 25,000 jobs in India. That means, the likes of Cognizant, TCS, Infosys, HCL, Wipro and Satyam will announce huge lay-offs over the next couple of quarters, The Times of India reported.

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As the banking, financial services and insurance (BFSI) segment is the largest outsourcing vertical for Indian technology players, the space contributes up to 40 percent of the revenues for some top IT firms.

The IT industry employs around 350,000 people in the BFSI space of which the top six players alone account for 180,000 jobs, with the domain accounting for $10 billion of the total $32 billion revenues the industry posted during the last fiscal.

Now with the crisis in Wall Street, one could see a somber picture of the things to come.

"The mid-year appraisal expected in October-November will be extremely crucial. Many companies may announce large-scale job cuts," said an HR professional at a leading IT firm, on a request of anonymity.

"Many companies have already asked recruitment firms to stop hiring in the last 24 hours" says Rajiv Mehrotra, country GM of hiring firm Kelly Services India.

Avinash Vashistha, Managing Director of offshore investment advisory firm Tholons, says, "Tech providers have been witnessing a sluggish growth in the BFSI vertical in the last 12 months. The impact is big as the space has been the pioneer and largest adopter of technology."

According to Naresh Malhan, MD of talent management firm Manpower India, if the situation prolongs for six to nine months, other verticals also will begin to be hit. Even the manufacturing sector will feel the pinch.

The direct effect of the demise of Lehman Brothers and Merrill Lynch is already being felt in the Indian job market. The nearly 2,500 employees of Lehman Brothers' captives in Mumbai have been asked to look out for jobs. A firm that supplied temporary staff to the Mumbai office of Lehman said it had laid off 150 of their people.