Companies Reduce Employees As Automation Gathers Pace

Most of the tech companies including Infosys, Tech Mahindra, Wipro and Cognizant have reported a decline in their headcount in the second quarter. Tata Consultancy Services and HCL Technologies have been the two exceptions, increasing their employee count, but to an extent and very little growth.

There have been news reports of companies laying off employees in 2017, but this is the first quarter where many companies have reported a drop in their employee numbers, including banking major ICICI bank.

Infosys ended the quarter with a total headcount of 1,98,440 and during first half of this year, reporting a net headcount decreased by 1,224 employees as compared to increasing 5,785 employees in first half of last year.

Cognizant has reported 2,56,100 employees at the end of the second quarter, down from 2,56,800 people at the end of June, and substantially lower than the 2,61,200 at the end of March.

Wipro reduced its number of employees to 1,63,759 at the end of September from 1,66,790 at the end of the June quarter.

The disruptive technologies are going to exert a lot of pressure on the industry and this will drive at least 40 percent reduction in the head count for the existing scope over the next two four years. The impact of automation and increased digital business will transform the work; putting less reliance on human effort.

Indian software industry valued at $150 billion is going through its worst time in a decade and the trend suggests that the automation and robots are driving a move away from the employees, along with creating newer and niche skills from their employees.

While the newer technology will demand more skills to stay relevant at work, we can expect a lot more reduction in number of employees, in various companies across different sectors.