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One of the biggest asset in finance is your earning power the ability to create the net cash flows which can repay the loans. You do not get a house loan, a car loan or a personal loan. What you get is a loan against your FORM 16, that you will be able to repay loan in future.  One of the profession which parents want their children to join is Engineering or IT,others being Medical, Lawyer,IAS. But  being an engineer now is so different from being an engineer 10 or 20 years back. Pink slip or getting laid off is now also happening in India. We’ll touch upon the challenges that IT is facing in India and try to seek answers to Are engineers facing a bleak future? We have also included an article by  former chairman of Microsoft India, Ravi Venkatesan, IT party is over. Now’s the time to reinvent or die.

IT Jobs 

Every parent whose child scores well in Science is hoping that the child gets into IIT or Medical. There are many coaching centres which have opened  up throughout India especially Kota in Rajasthan and online too, to prepare the child for IIT. Chetan’s Bhagat book Revolution 20-20 (pages 48-92) talks about coaching situation in Kota. You can read this at slideshare. An interesting debate on Quora Why do most Indians study engineering?

Since the 1990s there was rapid growth of India’s software development and Business Process Outsourcing (call center and back office). India’s IT and BPO (Business Process Outsourcing) sector reportedly employs up to 3.1 million persons directly and generates some $120 billion in revenue annually, including more than $70 billion in foreign revenue. However things have changed. More engineers, less employable engineers, weak demand in US, layoffs or pink slips are now associated with IT. 

India’s IT sector is increasingly being hammered by the world capitalist crisis, by anemic growth in the US and Europe and increasing competition from other countries with abundant cheap labour. Like many of India’s other industries, its IT sector is also being undermined by the deplorable state of public infrastructure, everything from the speed of transport and reliability of utilities to the low quality of the education provided by all but India’s premier universities and technical institutes. India’s IT and BPO sector has steadily lost business to other Asian countries, especially the Philippines, where salaries are even lower, as well as to Eastern Europe.

Indian economy is not growing at the same rate as the number of engineers.Engineering colleges have been springing up like wild mushrooms in India in the last few years. Their number has gone up from a not too modest 1,511 colleges in 2006-07 to an astoundingly high 3,345 in 2014-15.There is a mismatch in the aspirations of graduating engineers and their job readiness. 97% engineers aspire for a job in IT and core engineering. However, only 18.43% employable in IT & 7.49% in core engineering.  20-33% out of the 1.5 million engineering graduates passing out every year run the risk of not getting a job at all. For those who do, the entry-level salary is pathetically low, and has stagnated at that level for the last eight-nine years, though the prices of everything from groceries to vehicle fuel have shot up during the same period.

Two key industries which hire engineers in India- the IT and ITes and the manufacturing sector- are also hiring a lesser number of them than before. As against 76% of the 1,389 IIT Mumbai pass outs getting campus placements during the 2011-12 session, only a little above 66% out of the total 1,501 could find campus placements in 2012-13 The situation is grimmer for Tier II and Tier III colleges. The huge disparity between start out salary for top colleges and the not so highly sought after ones, which has already been highly pronounced, is expected to widen further.  Meet millions of India’s engineers – unemployed or stuck in unrelated jobs. Recently I read about Uber and Ola drivers earn up to Rs 1 lakh per month Many engineers becoming cab or auto drivers.

Job security is no longer associated with IT jobs. Layoffs is now part of every industry , especially one which is down. For example Nokia shut down it’s manufacturing factory in Chennai making 5000 people unemployed. With airlines criss airline staff got affected. In 2008 due to financial crisis people in financial industry were impacted. Pink slip is a something that many of those in IT might face in future. Mass Layoffs talks about it in detail. Kind of skills needed in the industry change with time. A decade ago needs for IT market were very different from the IT market today. Today there is high demand for jobs like data analysis, eCommerce which are high paying jobs (and high pressure too).  Our article Losing a Job : Why the Layoffs, Managing finances talks about financial moves to help you tide over the period.

IT party is over. Now’s the time to reinvent or die

Article from Times of India by  Ravi Venkatesan,former chairman of Microsoft India
India’s IT industry is unlikely to remain the amazing job engine that it has been. For the past two decades, the fastest way to increase your income has been to land a job with an IT company . The industry has provided a ticket to prosperity for mil lions of young Indians; children of security guards, drivers, peons and cooks catapulted themselves and their families firmly into the middle class in a single generation by landing a job in a BPO. Hundreds of engineering colleges mushroomed overnight churning out over a million graduates a year to feed the insatiable demand of India’s IT factories.This party is coming to an end.
A combination of slowing demand, rising competition and technological change means that companies will hire far fewer people. And this is not a temporary blip -this is the new normal. Wipro’s CEO has bravely admitted that automation can displace a third of all jobs within three years while Infosys CEO Sikka aims to increase revenue per employee by 50%. Even Nasscom, the chronically optimistic industry association, admits that companies will hire far fewer people. Not only will the lines of new graduates waiting for job offers grow rapidly longer every year, but so too will the lines of the newly unemployed as all companies focus more on utilization, employee productivity and performance. Employees doing tasks that can be automated, the armies of middle managers who supervise them and all those with mediocre performance reviews and without hot skills are living on borrowed time.
So what do you do if you are a member of these endangered species? What constitutes good career advice in these times? I’d say that the first thing is to embrace reality and recognize that the game has changed for good. The worst thing to do is be wishful and wait for the good times to return. They won’t. But there are still lots of opportunities. What’s happening in the industry is creative destruction. New technologies are destroying old jobs but creating many new ones. There is an insatiable demand for developers of mobile and web applications. For data engineers and scientists. For cyber security expertise. So for anyone who is a quick learner, anyone with real expertise, there will be abundant opportunities.
There has also never been a better time for anyone with an iota of entrepreneurial instinct. India is still a supply-constrained economy and so there is room to start every kind of business: beauty parlour, bakery , catering, car-washing, mobile, electronics repair, laundry , housekeeping, tailoring. For entrepreneurs with a social conscience, there is a massive need for social enterprises that deliver affordable healthcare, education and financial services. Not only are there abundant opportunities but startups are “in“ and there is no shame at all in failure. The ranks of angel investors are swelling and it has never been so easy to get funded.There is even a website, http:www.deasra.in, that provides step-by-step instructions to would-be entrepreneurs.
For those who prefer a good old-fashioned job, there are abundant jobs in old economy companies which are struggling to find every kind of talent -accountants, manufacturing and service engineers, sales reps. Technology is enabling the emergence of new sharing services such as Uber or Ola that enable lucrative self-employment; it is not uncommon to find cab drivers who make Rs 30,000-40,000 a month.
My main point should be clear. While India may have a big challenge overall in creating enough jobs for its youthful population, at the individual level there is no shortage of opportunities. The most important thing is a positive attitude. The IT boom was a tide that lifted all boats -even the most mediocre ones.However, this has bred an entitlement mentality and a lot of mediocrity . To prosper in the new world, two things will really matter.
The first is the right attitude.This means a hunger to succeed. Being proactive in seeking opportunities, not waiting either till you are fired or for something to drop into your lap . A willingness to take risks and the tenacity to work hard and make something a success. Humility . Frugality .
The second is the ability to try and learn new things. The rate of change in our world is astonishing; whatever skills we have will largely be irrelevant in a decade.People are also living much longer. So the ability to learn new things, develop new competencies and periodically reinvent ourselves is a crucial one. Sadly , too many of us have no curiosity and no interest in reading or learning. The future will not be kind to such people.
“The snake which cannot cast its skin has to die.“ 
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What do you feel about Changing Job scenario in IT? How are you coping with it? Do you want your children to be engineers? If yes why?

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