A global IT slowdown has had a ripple effect, with layoffs affecting IT companies in the city.
What’s it about? Last quarter, 21,000 jobs in the IT sector were cut as a global slowdown took hold in India. For Chennai, 40-50% of its GDP is from the IT sector. Chennai and Kancheepuram have a big employee base for IT companies. The outlook doesn’t look good.
- The most vulnerable are those who don’t directly impact the revenue. It usually begins with the administration or HR divisions. Those with poor performance reviews are also vulnerable. Sometimes, specific roles are eliminated.
- Employee unions have taken the fight to companies. Union of IT and ITES Employees (UNITE) is one example that has filed 300 cases against illegal layoffs in IT companies. It has formulated a model to regulate IT employee practices.
How we got here? As the pandemic hit, new market opportunities and recruitment drives became unsustainable once restrictions were lifted. With no proper roadmap, companies had to lay off employees. Market trends meant the operations weren’t profitable. Big companies might not have a problem and could survive by cutting costs.