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Monday, Apr 22, 2002

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IT recruitment — Are the dark clouds receding?

Bharat Kumar

CHENNAI, April 21

SOFTWARE is an industry dependent on manpower and any brightening of prospects is typically preceded — or at least accompanied — by increased recruitment.

Ask anyone in the software industry how it is now and you receive a smile, with, ``Clients are at least speaking to us about projects. Things are looking brighter.'' One Mumbai-based IT analyst even told Business Line that there is a definite story here, since recruitment numbers are picking up.

But, overall, even with bits of good news from here and there, the recruitment industry feels that it isn't yet time to throw those hats up and rejoice. Ask Mr Satish Doshi, Managing Director, Sampoorna Computer People, a manpower firm, what he thinks of the software industry's optimism, and his answer wraps up the issue succinctly.

``A bad last year is making people over-react to small positive signs and ignore the bad news because it has become routine,'' Mr Doshi said. Recruitment hasn't jumped up by leaps and bounds, even if we look at the last quarter or two when optimism has risen slightly. Says Mr Doshi, ``For the recruitment industry in IT, the year ended March 2002 saw a dip in revenue of 25-35 per cent compared to the last year. Similar figures would apply for corresponding quarters.''

This is true even if the IT industry is seeing a few more orders and projects. According to Mr Doshi, ``The IT Industry has mainly concentrated on reducing bench and on better use of existing manpower in the year. Now, demand for specific skills is increasing compared to previous quarters.

Recruitment now is just-in-time and clearly tailored to a specific need. It is also targeted to improve company productivity by replacing poor performers. Demand for marketing professionals is also up. But while the IT industry is looking at lesser and better recruits, the applications seem to be flowing in. According to N. Muralidharan, CEO of Jobstreet India, an online placement firm, ``both in the IT and non-IT jobs on our site, the number of quality applicants is very high currently, as compared to a year back. This shows that not only the average person is out looking for a job, but also quality programmers and managers from all fields are in the market today. Interestingly, there has been a considerable to shift to recruit senior profiles in the mainframe areas this year where as technology areas ruled last year.'' Says Mr T. Sreedhar, Chief of Operations at TMI Network, a Hyderabad-based recruitment firm. Not all recruiters are ready to share figures but here's an indicative list: Jobstreet says that IT job postings were stable at 518 for the March quarter this year compared to 508 postings for the same quarter last year. (For thecompany, the number of postings filled, averaged between 10-12 per cent of postings.)

TMI grew roughly 45 per cent in IT recruitment in 2002 over 2001. Ma Foi, a Chennai-based recruitment consultant clocked 479 recruitments in IT and ITES in the March quarter this year, compared to 180 the previous quarter and 602 in the quarter before that.

Interestingly, IT enabled services (ITES) is proving a green pasture. Jobstreet has seen a 300 per cent increase in postings, from 700 in March 2001 to 2,800 in March 2002. It had a total of 20,400 postings for the year ended March 2002. However, ITES may soon see rough going in the near future. According to Mr Muralidharan, ``the industry is lapping up most of the slack generated by the slowdown in the last year in Indian industry. That will continue this year. It has a long way to for long-term career prospects. For, when other industries such as software start ramping up, ITES may have a problem in retaining or pulling in talent.''

In contrast, telecom — which too has seen growth — has been steady and slow. Says Mr Muralidharan, ``there is more focus on industry experience. Some companies are slowing down whereas others are pulling ahead. So, cross-pollination is more prevalent with few chances for outside industry placements. Experience in the industry is the key here.''

Jobsteet saw a 36 per cent jump in telecom postings from 116 in March 2001 to 158 in March this year.

The December quarter saw only an 8 per cent jump. According to Mr Sreedhar, ``Telecom is a sunrise industry. So, recruitment for any function other than technology, was relatively easy, thanks to the mood in other segments such as FMCG and like industries. With the disinvestments process happening, there was some uncertainty.

Moreover, telecom companies joined together and decided not to poach from each other. The practice helps consolidate during the launch phase. Over a period of time, the market for job change will open up.

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IT recruitment — Are the dark clouds receding?

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