Engineering colleges may reduce seats, look beyond IT for campus placements4 min read . Updated: 10 Feb 2017, 09:29 AM IST
Weak earnings and H1B visa curbs have forced IT companies to go easy on campus placements, prompting engineering colleges to consider reducing seats
Mumbai: Weak earnings and visa curbs have forced IT companies to go easy on campus hiring, prompting engineering colleges to consider reducing seats in some streams with low recruitments, placement officials from at least three campuses said.
With fewer technology companies coming to campuses, placement cells have invited non-IT companies as well this year, the officials mentioned above said, on condition of anonymity.
“I think the days of hiring thousands of students from one campus is gone," said a placement official from one of the top engineering colleges in Chennai, one of the three officials mentioned above.
“All companies have reduced their hiring by 15-20%. There is about 30-40% drop in placements this year. While Brexit is one thing, automation and (concerns over) H-1B visa is adding to the lack of jobs," he added, asking not to be identified.
Greater use of artificial intelligence and cloud computing have challenged the business model of India’s IT companies. At the same time, by sharply increasing minimum salary requirements, the US is planning to squeeze the inflow of H1B visa holders, who are mostly sent to work there by leading IT companies such as Tata Consultancy Services Ltd (TCS), Infosys Ltd and Wipro Ltd.
SRM University, which has three campuses in Chennai and one in Delhi, claims it had placed a total of 6,064 students with technology companies last year.
According to Sriram Padmanabhan, director, career services, SRM University, the big four IT companies continue to be the top recruiters. “Additionally, we have been working hard to reach out to newer companies including IT, IT product and core engineering companies. We already have 50% more companies visiting our campus for recruitment this year when compared to this time last year," he said.
When asked about a possible reduction in seats, Padmanabhan said, “As regards the future, we fine-tune our strategy in line with the global situation, domestic market needs and economic developments after deliberations at the highest levels in the university."
India has around 6,400 engineering colleges and the poor performance of some of them has caught the attention of the technical education regulator, the All India Council of Technical Education (AICTE). “We have started a new clause that if any engineering branch or stream in an institute does not have more than 30% admission consistently for five years, we would be shutting down those colleges. From the next academic year, we will ask the colleges to close down," said Anil Sahasrabudhe, chairman, AICTE.
TCS and Capgemini declined to comment when asked if they had reduced hiring.
In an emailed response, Infosys said, “The hiring numbers in India continue to be in the same range as compared to previous years."
G Balasubramanian, chief placement officer, (India and Dubai) Birla Institute of Technology (Pilani) University, said though the institute is not dependent on the services companies for placing its students, it has not seen any major drop. “However, the number of selection from these software companies have been little less than last year. So it’s definitely a trend that we see. The number of (software) companies that come to our campus has dropped a bit to the tune of 5-6%.," he said.
In July 2016, the National Association of Software and Services Companies (Nasscom), an industry lobby, had hinted at a gloomy hiring outlook for the current fiscal. “Hiring activity in the year before last was 2.20 lakh (new jobs were created in IT sector). Last year, (FY2015-16) there were about two lakh additions. This financial year, we are expecting it to be on the lower side of that," R. Chandrashekhar, president, Nasscom, had said on 21 July, 2016.
One of the placement officials mentioned above said given the paucity of jobs in the IT sector, they have also advised students to take up jobs in other segments of engineering.
According to Rituparna Chakraborty, co-founder and executive vice president, TeamLease, a recruitment and staffing company, given the uncertainty over the H-1B visa programme, hiring has slowed down in IT in the past year. “And now, the IT companies may have to overhaul their hiring strategy altogether. Hiring from India for US will definitely take a beating and be replaced by hiring locally in the US. And to some extent it will impact the local youth of India."
Earlier this month, three bills seeking to reform the H-1B visa programme were tabled in the US. One of the key changes proposed include doubling the minimum salaries of H-1B visa holders to $130,000, a move that could affect many IT firms which use it to send thousands of professionals to the US each year.
Every year, the US Citizenship and Immigration Services (USCIS) issues around 85,000 H1B visas, most of which are taken up by Indian IT firms.
While many Indian IT professionals are hopeful that the bills may not go through as it would impact the overall US market, a few others say they are prepared to take pay cuts and come back home if at all the situation arises.