by: Dr. Shikha Suman
We are hoping the Indian industry has the resilience to cope with the problem. Some sectors may feel some jolts, but largely we are hopeful that there wont be any such layoffs in India said the Commerce Minister on the 18th Nov 2008. This makes us wonder whether we are aware of reality or are we just running away from it.
Owing to the economic slowdown the USA there are many sectors of the Indian industry that were badly hit. Some of the sectors that were hit most include Banking, Infrastructure, IT, Real estate (due to high interest rates and lack of positive sentiments), Automobile (high interest rates and high fuel prices), Power (due to less consumption), Hospitality, Travel and Tourism.
With so many sectors hit and hit so badly it is safe to say that many of the companies in these sectors were in the red and also had to close shop in some instances. Job losses in India may not be called layoffs but may be addressed differently. The sector that is most badly hit is the IT sector. Hence the common saying that goes WHEN AMERICA SNEEZES THE WORLD CATHES A COLD.holds very true to the Indian IT sector. Even if you have a lot of other priorities for instance, sports, extracurricular activities, etc., still you need to complete a senior project to graduate successfullyThe US is a major client of the Indian IT sector the US economy is the largest spender on the IT products and services. Now that the US economy is in a recession it has started creating and sending the ripples across to the Indian economy. The Indian IT sector is majorly dependant on the US and will suffer huge losses in such a case.
According to various reports, IT sector is facing and moving further towards a recession. Every IT organization, whether small or big, is reducing its workforce. TCS, the IT giant in India, asked 500 employees (having 2-3 years of work experience) to leave
IBM laid off 700 employees (mostly freshers) from its Indian offices
Yahoo! Laid off 45 employees Comparatively smaller firms like Headstrong have also being laying off employees citing their unsatisfactory performance as the reason.
Hyderabad based IT giant Satyam handed over the pink slip to almost 4500 of its employees. Some of them have been put under the Performance Improvement Plan.
http://www.youtube.com/watch?v=n8x-3urT0zw
There were indications that Wipro also put its employees under the scanner.
Such instances were visible mainly in the IT sector. The reasons being as mentioned above the recession in America and maybe to some extent the overrated IT professional and the excessive recruitment by IT companies from various campuses across the country.
One can understand from the scenario that is emerging in India is other sectors of our economy though have underperformed have not seen layoffs. They have been closing down for a few days in order to cut costs. Tata Motors Ltd, Indias largest vehicle maker, closed two of its commercial vehicle plants for six days. This was a measure taken to cut costs. Following this move Dunlop factory also shut its factory in Tamil Nadu as a cost cutting measure. (this was done because of the high power cost levied by the state government).
In the Aviation sector there was news of layoffs. The case of the carrier Jet Airways is worth a mention here. There was news of the carrier laying off its staff but had to reinstate it very soon. Our very own Maharaja also have denied reports of layoffs. Now that fuel prices have also come down drastically it is safe to believe that the industry does not face major adversities.
To a very large extent one can say that the minister is right when he says they are hopeful that there wont be layoffs in India. Hence summing it up on a positive note, ours being a consumption driven economy hence the growth rate hovering around 7-7.5 % always seems inevitable. Again in a democracy with very strong labor laws it is very difficult for Indian companies to render a pink slip to their employees.
http://www.marxist.com/economy/
economy
