What is keeping India's engineers unemployed
Somewhere between a fifth to a third of the million students graduating out of India's engineering colleges run the risk of being unemployed. Others will take jobs well below their technical qualifications in a market where there are few jobs for India's overflowing technical talent pool. Beset by a flood of institutes (offering a varying degree of education) and a shrinking market for their skills, India's engineers are struggling to subsist in an extremely challenging market.
According to multiple estimates, India trains around 1.5 million engineers, which is more than the US and China combined. However, two key industries hiring these engineers -- information technology and manufacturing -- are actually hiring fewer people than before.
For example, India's IT industry, a sponge for 50-75% of these engineers will hire 50,000 fewer people this year, according to Nasscom. Manufacturing, too, is facing a similar stasis, say HR consultants and skills evaluation firms.
According to data from AICTE, the regulator for technical education in India, there were 1,511 engineering colleges across India, graduating over 550,000 students back in 2006-07. Fuelled by fast growth, especially in the $110 billion outsourcing market, a raft of new colleges sprung up -- since then, the number of colleges and graduates have doubled.
Job problems...
Jobs have, however, failed to keep pace. "The entire ecosystem has been built around feeding the IT industry," says Kamal Karanth, managing director of Kelly Services, a global HR consultancy.
"But, the business model of IT companies has changed...customers are asking for more. The crisis is very real today." Placement numbers across institutes -- including tier-I colleges such as IIT Bombay -- have mirrored these struggles.
In 2012-13, in IIT Bombay, a total of 1,501 students opted to go through the placement process. At the time of writing, only 1,005 had been placed (placements are currently underway in the institute).
In 2011-12, 1,060 of the 1,389 students were placed. Further down the pecking order, at the Amity School of Engineering and Technology, placements are muted. The number of companies visiting is down from 86 last year to 67 in 2013 at the time of writing (placements are currently underway).
Batch sizes have reduced drastically at its Noida campus this year, with 365 students placed so far in a batch size of 459, compared to 1,032 being placed in a batch size of 1,160 last year.
"Some companies have delayed the joining dates of students who passed out last year and they are still waiting to be placed," says Ajay Rana, director, Amity Technical Placement Centre. "We can expect joining dates of students who passed out this year to be deferred by a minimum of six months."
...Trickle down
This muddled equation is now showing signs of social and economic strain across the country. Frustrated engineers are taking jobs for which they are overqualified and, therefore, underpaid.
A few exceptions have even turned to crime. According to media reports, Manjunath Reddy, a civil engineer, turned to chain snatching in Thane, a suburb of Mumbai, to support his young family. While he used some money to buy a small flat in peripheral Mumbai, his failure to net a job drove him to crime, he told the police when caught.
Like him, another engineer in Aurangabad turned to car lifting as a route to easy money. "The social aspect of this massive under-employment and unemployment will soon be witnessed," warns Pratik Kumar, HR chief of Wipro and chief executive of its infrastructure engineering unit.
Hiring is slowing down because recruiters are changing their strategy. "An engineering degree is a poor proxy for your education and employment skills," says Manish Sabharwal, chairman of TeamLease, a temp staffing firm.
"The world of work is evolving... employers increasingly don't care what you know, they focus on what you can do with that knowledge." While dozens of new institutes have been established in the past six or eight years, he claims that over a third of them are empty and perhaps they are "worth more dead (for the real estate they sit on) than alive."
A global economic slowdown may have only worsened what is already a bad problem, say others such as Amit Bansal, co-founder of Purple Leap, a skills assessment firm, which routinely gauges the capabilities of students across these institutes.
"Even without this slowdown, there are a large number of students who won't get a job," he says. Bansal estimates that, at best, there are 150,000-200,000 jobs generated annually in the Indian economy and far too many engineers attacking this labour pool.
What's more, India's technical talent pool is also warped, with almost the same number of engineers as technical graduates from institutes such as ITI. "In developed markets, there is usually one engineer for every ten," says Bansal. This skew is only compounding the woes of engineers in India.
Source: TOI
Campus recruitment show a decline this year
HYDERABAD: The global economic meltdown has resulted in a 10% drop in campus placements in city colleges this year. Though IT jobs have remained impressive with 80% of the total number of placements, but for those aspiring for jobs in sectors such as manufacturing, life science. journalism, psychology, advertising etc there was little to cheer about.
"Intakes have been low this year with many companies ruing poor business abroad. So far only 15 companies have visited the campus and nearly 150 students have been placed," said Seema Ghosh, placement coordinator at Bhavan's Vivekananda Degree College that has fared much better in the previous years. For instance, Wipro Technologies, which selected 70 students from the campus last year, restricted itself to 37 this time around.
While Facebook, usually among the biggest employers, has stayed away from campuses altogether, Deloitte has limited its recruitments to its IT wing. Unlike in the past, they have not signed anybody for its BPO and tax arms. "This time, companies are offering internships to students after which a selected few are being offered jobs. Around 30 students completed a four-month internship with Amazon, from which around 15 were shortlisted for further rounds," said Anju Prasad, placement officer at St Mary's College, Yousufguda.
At engineering colleges too, there is not much hope with companies cutting down on their placements. "Cognizant always selects the maximum number of students from our college. This year, though they are still the biggest recruiters, the number of students selected has gone down from 410 to 252," said N L N Reddy, placement coordinator at Chaitanya Bharathi Institute of Technology (CBIT). At Sreenidhi Institute of Science and Technology (SNIST) too, about 260 students have been picked up by Cognizant this year as against 360 last year. Similarly, Infosys recruited around 90 students this time around while last year the number was more than 160.
With most of the jobs being offered by IT and its related sectors, college officials lamented the lack of options for students from diverse streams. "There have been no offers for students who want to pursue careers in various other fields," said Marie Thomas, placement officer at St Francis College Begumpet, "Most of the IT jobs are taken up by students of B Com, BMS and B Sc," she added.
Seconding it, N L N Reddy said that the lack of offers from sectors such as manufacturing or even electronics had left students from these streams with no choice but to take up IT jobs.
Premier institutes like IIT, Hyderabad and BITS, Pilani Hyderabad campus, however, seemed to be insulated from this 'poor show'. According to officials of these colleges, the recruitment season has been satisfactory with big names like Morgan Stanley, Samsung, Mercedes Benz, Ashok Leyland, Nvidia, Honda and Cisco conducting recruitment drives at these campuses. At IIT Hyderabad, around 45 companies have made an appearance so far and more than 100 students have been placed. The BITS campus on the other hand has been visited by around 65 companies and 90% of the batch has already been placed.
Source : TOI
30 software companies break away from Nasscom
Thirty Indian software product companies have come together to form a new association, marking the first break from the omnibus IT industry body Nasscom and reflecting the growing confidence and maturity of the software product community. The thirty founding members, led by Bharat Goenka, co-founder of Tally Solutions, Sharad Sharma, former head of Yahoo India R&D, startup mentor and founder of Brand Sigma, Naveen Tewari, founder of InMobi, and Vishnu Dusad, founder of Nucleus Software, will have their first meeting in Bangalore on Monday to formalize the association and develop action plans.
The association, called the Indian Software Product Industry Round Table, or iSpirt, has been formed with the vision that India now has the basic building blocks to develop a powerful software product industry that can help transform India, as also deliver invaluable solutions to the rest of the world. All of the founding members individually have strong customer bases in India or around the world. The objective now is to share expertise and experiences, and create a larger awareness in society and government about the critical role the industry can play — something they believe they cannot effectively do under the larger Nasscom umbrella.
"A few good software services companies may be good enough to serve the top 500 hospitals in India. But if you want to address 5,00,000 or more hospitals around the country, you cannot do it without software products," says Goenka, who many regard as the father of the Indian software product industry and whose Tally accounting solution is used by virtually every small business in the country, an accomplishment that earned him Nasscom's first and till now the only Lifetime Achievement Award.
The problem of scalability arises in software services because of its total dependence on people to implement solutions. This is the kind of work the Indian software industry, including companies like TCS, Infosys and Wipro, have traditionally done. Software products, on the contrary, can be bought off the shelf and customers can implement many of these on their own. The best examples of these are Microsoft's Windows and Office.
Naveen Tewari, whose mobile ad network is used by over 250 of the Fortune 1000 companies and is second only to Google's AdMob, notes that all IT solutions in education today are directed at the likes of the IITs and IIMs. "You need education products to reach out to the mass of educational institutions. India today has extremely smart people who can develop such products. The market outside India is also huge. There are three-four billion people living in countries similar to India who can be serviced by Indian product companies," he says. Every town in India is seen to have one or two people who have developed some software product that they are selling among a small customer base. One study the association did found that there were at least 17 software products developed for jewellery in India, but the developers had an average of no more than 2,000-3,000 customers each, even though there are an estimated 3 lakh jewellers in India.
"These small developers are unable to see the big picture, think big. The association's initial efforts would be directed towards creating the knowledge bank and environment required for these developers to explode," says Sharad Sharma. He says it will simultaneously work to create awareness about why the industry is important for the national agenda. "Once society recognizes our value, we hope to influence the government to create better taxation and policy frameworks," Sharma says.
Asked how Nasscom felt about the product companies creating a separate association, Goenka said, "I have been talking with Som Mittal (Nasscom president) for some six months about this. Nasscom has promised support. We will not be in conflict with anybody." Vishnu Dusad said iSpirt would work with all industry associations — including Nasscom — that are dedicated to creating world-class products and intellectual property.
Nasscom tends to be dominated by IT services companies. Sub-segments within it, including the BPO companies, have often felt that their issues were not being sufficiently addressed. But this is the first occasion where a segment is breaking away, though some will be members of both Nasscom and iSpirt. And this is happening just when Nasscom had established a committee under Infosys founder N R Narayana Murthy to make recommendations on how to make the organization more relevant given the changing IT environment.
iSpirt will not have a president or any such nomenclature. There will be a governing council consisting of Sharma, Goenka, Tewari and Dusad. "We'll have a flat structure and have a volunteer model. We believe that creates higher quality outcomes than one where you have a paid official running the organization," Sharma says.
Source : TOI
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