Some of the clouds have cleared, but it is not fully sunny yet.
The placement season is here and this is the time when recessionary trends and labour markets assume significance even for guitar-strutting undergraduate students. After going through two slump years when most students were willing to take any offer that came their way, are there any signs of recovery this year — especially in what used to be India's sunshine sector, the IT industry?
During the last two financial years, the number of employees in the ‘non-performance' category rose significantly as a result of a strategy adopted by companies whereby they increased performance criteria in order to weed out employees citing ‘non-performance' as the reason.
There was a freeze on hiring or deferred hiring; zero salary hikes for senior and middle management this year; increase in training period of fresh recruits; and promotions at junior level which used to happen in 15 months, now takes three years.
Though analysts have suggested that recruitment will stabilise in a year's time, this is the backdrop against which students will be taking their placement exams this year.
Ravi Sinha, Professor in Charge, Placements, IIT-Bombay, said “All sectors of the economy are showing recovery. The best students are taking core sector jobs instead of taking IT jobs. Because of the recession, students are looking at the nature of the job profile more carefully and have developed a long-term perspective.”
He also pointed out that this year there has been a sudden jump in salary packages (increase by 30 per cent) as compared to the slump last year and companies are hiring more students in each job profile.
“However, IITs have always had our own definition of what constitutes a good or bad placement season. The real scenario will be known once placements start in aided and affiliated colleges,” he added.
Karthik Medarmetla, academic affairs secretary, IIT-Madras, said that there has been a trend towards taking up Public Sector Unit (PSU) jobs. “About 10 per cent of students sitting for placements this year have already taken up PSU jobs. Last year, security of offers was a problem as many companies backed out after hiring candidates. There have been no such issues this year.”
Industry insiders say that as a result of the slowdown period, many companies have learnt to adapt with a leaner workforce that can multi-task efficiently. Having learnt to do with less, many would be averse to hiring in large numbers.
“Though it was a difficult phase, it was a rich learning experience and made companies look at new geographies, ideas and technologies. There has been renewed focus on the domestic market which is set to grow by 40 per cent,” said K. Purushothaman, Regional Director, NASSCOM.
He added that placements are going to be tough this year as there are limited positions and companies are not going to invest a lot into training. “I would ask students to pick companies that they want to work in right now and start analysing their requirements.”