Saturday, July 25, 2009

Bangalore's IT tribe fights to stay on the job

Till a few months ago, IT professional T V George was earning Rs 70,000 per month, plus perks. But after losing his high-paying job, and being unemployed for three months, George, 31, has started giving tuitions in mathematics and physics to aspiring engineering students.

"Now, I am earning Rs 15,000 per month. It's been hard. I got married only a few months before losing my job. So, when I lost my job, I was in a difficult position. Thankfully, I had some savings. With the savings, I am paying my rent and for a few other necessities," says George, who was employed with a top US IT company.

"After losing my job, I tried my best to get a new job. But I remained unlucky. So to help run my home, I decided to give coaching classes to aspiring engineering students."

George is not alone. Recession has hit the IT sector in Bangalore, with scores of technology professionals losing their jobs. Some have been forced to take up low-paying jobs as they wait to bounce back when the recession ends.

Dipankar Dutta, 27, working with an Indian IT company as software engineer, lost his job almost eight months ago.

Today he has a job, but as a content writer in a tech firm.

"Thankfully, writing has been my forte. So, I landed this job of a content writer. Otherwise I would have been in a soup. Since I cannot afford to stay in Bangalore without a job, I compromised and settled for the new job with a much lower pay package," said Dutta.

Scores of IT and ITES professionals in Bangalore have lost their jobs in recent times, an effect of the global economic meltdown. But there is no precise count of the numbers.

According to the latest employment and business outlook report by Bangalore-based staffing firm Teamlease, at 23 percent the attrition rate in this city is higher than in any other in India.

The report was based on interviews with HR heads, CEOs and senior executives of 495 companies in Bangalore, Chennai, Hyderabad, Kolkata and Pune.

"The city accounted for the highest attrition rate. IT accounts for over 80 percent of the city's total labour pool. The attrition rate was 23 percent in the last quarter, against the previous quarter's 16 percent. Much of the attrition could be involuntary attrition (or layoffs)," Teamlease general manager Surabhi Mathur-Gandhi said.

India's Silicon Valley has seen thousands of people getting pink slips in recent months. And many more are under the threat of losing their jobs.

"It's painful to lose your job, in today's expensive world. Those who have lost their jobs are desperate now, thus they are settling for low paying jobs," Karthik Shekhar, general secretary of UNITES-Professionals, an unrecognised union of IT/Call Centre/BPO employees, told IANS.

"Every day we meet young men and women who have lost their IT jobs recently. All they want is a job. But getting a job in the IT sector is very difficult. So, they have no option but to settle for jobs outside their fields and that too with low paying packages," Shekhar added.

"It's encouraging that today's youths are ready to move ahead in their lives. Instead of waiting for the economy to revive, IT professionals have started exploring other fields and this is a positive sign," said B.N. Gangadhar, professor of psychiatry at the National Institute of Mental Health and Neuro Sciences (Nimhans), Bangalore.

"Initially it was difficult, but I am happy with my choice. After losing my job with an IT firm, now I am working as a sales executive. I am hoping the economy will recover soon and all the professionals who have lost their jobs will get new jobs in their field," says Mohammed Khan, a software engineer.

Thursday, July 23, 2009

New jobless claims rise to 554K, total rolls fall

The number of newly laid-off workers seeking jobless benefits rose last week, though the government said its report again was distorted by the timing of auto plant shutdowns.

Unemployment insurance claims have declined steadily since the spring, but most private economists and the Federal Reserve expect jobs to remain scarce and the unemployment rate to top 10 percent by year-end.

Elsewhere, the housing market showed more signs of life as sales of previously occupied homes rose for the third straight month in June, according to the National Association of Realtors. That helped push the Dow Jones industrials above 9,000 for the first time since early January.

The Labor Department said Thursday that its tally of initial claims for unemployment insurance rose by 30,000 to a seasonally adjusted 554,000. That was above analysts' estimates of 550,000.

The increase follows two straight weeks of sharp drops largely because automakers didn't lay off as many workers as expected in early July. General Motors and Chrysler temporarily shut down many of their plants earlier than usual this year, in May and June, after filing for bankruptcy protection and restructuring their companies.

A department analyst said the government's seasonal adjustment process expected claims to drop sharply last week, after the normal pattern of auto layoffs was complete. But that didn't happen, causing seasonally-adjusted claims to rise.

Still, some economists saw positive signs in the report. The four-week average of claims, which smooths out fluctuations, dropped to 566,000, its lowest level since January.

"The trend in jobless claims is still downward," Joseph Lavornga, chief U.S. economist at Deutsche Bank, wrote in a note to clients.

But Lavornga also said the unemployment rate likely will keep rising as long as initial claims remain above 400,000. He expects the jobless rate to increase to 9.6 percent this month, from a 26-year high of 9.5 percent in June.

The financial markets shrugged off the news. The Dow Jones industrial average added about 170 points in midday trading to 9,055. Broader indices also rose.

Still, weekly claims remain far above the 300,000 to 350,000 that analysts say is consistent with a healthy economy. New claims last fell below 300,000 in early 2007. The lowest level this year was 488,000 for the week ended Jan. 3.

The total jobless benefit rolls, meanwhile, fell by a more-than-expected 88,000 to 6.2 million, the lowest level since mid-April. And the four-week moving average of claims, which normally smooths out some volatility, fell by 19,000 to 566,000.

But the number of people on emergency extended state and federal programs continued to rise. Unemployment insurance recipients can receive up to 53 weeks of additional benefits from the emergency programs, on top of the 26 weeks typically provided by the states.

When the extended benefit rolls are included, more than 9.1 million people received jobless benefits for the week of July 4, the latest data available.

On the housing front, home sales rose more than expected to a seasonally adjusted annual rate of 4.89 million last month, from a downwardly revised pace of 4.72 million in May. Home sales last rose for three straight months in early 2004, during the housing boom.

But prices are expected to keep falling well into next year because of a backlog of foreclosures that have yet to come on to the market. The median sales price was $181,800 last month, down 15 percent from last year but up from $174,700 in May.

The recession, which started in December 2007 and is the longest since World War II, has eliminated a net total of 6.5 million jobs. The unemployment rate in June rose to 9.5 percent, a 26-year high.

More job cuts were announced this week, many by major airlines.

Houston-based Continental Airlines Inc. reported a quarterly loss of $213 million and said it would slash 1,700 more jobs on top of 1,200 already announced. Southwest Airlines Co., which has never laid off workers, announced that 1,400 employees - about 4 percent of its work force - took offers of cash and travel benefits to leave the Dallas-based company.

Among the states, New York reported the largest increase in initial claims, with 12,504, which it attributed to higher layoffs in the construction and transportation industries. The next largest increases were reported by North Carolina, Florida, Missouri and Tennessee. The state data lags initial claims by one week.

Michigan reported the largest decrease, with 6,648, which it attributed to fewer layoffs in most industries. Massachusetts, New Jersey, Indiana and California reported the next largest drops.

Thursday, June 4, 2009

Microsoft Plans To Lay Off 1% Of Indian Workforce

Software giant Microsoft announced its plans to cut 1% of its Indian staff as its net income declined 11% during the December quarter because of worldwide economic slowdown.

The declaration on this is part of the Redmond-based company's decision taken during January 2009 to slash around 5,000 jobs worldwide by June 2010 in order to save up to $700 million (Rs 3,500 crore).

The job cuts in India are part of the second round.

In India, the company's decision will impact around 55 people across Microsoft's six-business divisions spread across Bangalore, Delhi and Hyderabad.

In a major declaration, the company said, "Due to a global realignment of our business priorities, about one percent of the net rolls across India are likely to be impacted. These adjustments reflect the necessary changes to ensure that the right resources are focused on the right priorities."

When asked to give detailed information, the company's spokesperson declined to comment saying "We are currently working with the concerned employees to evaluate alternative positions internally and where applicable look at mutually favourable disengagement terms."

In a 10-Q filing to the Securities Exchange Commission on April 23, Microsoft said that it had reserved around Rs 1,200 crore for severance for 3,400 laid-off employees, "all of whom are expected to leave the company by June 30, 2010".