IT companies to shed 5-10% of mid-level workforce: Ex-CFO of Infosys

Information techlogy companies in country have choice but to lay off at least five to ten per cent of ir middle-level staff to ward off margin pressure and become more agile, IT industry veteran V Balakrishnan said on Thursday.    

middle-layer accounts for about 20-30 per cent of total workforce of IT companies.

former Chief Financial Officer of software giant Infosys Ltd said companies have choice because y all have built a lot of fat in middle, so y have to reduce it and become more agile.

"Also, y have to get employees who understand new techlogies, y have to get rid of some of employees, who are more on legacy, and try to attract talent which is more digital, that has to happen, re is choice", Balakrishnan told PTI.

Asked if or companies would follow suit after lay-offs at Cognizant and Infosys, he said y have choice, because re was lot of pressure on margins.

"When you go more on digital side, customers are also becoming more conscious about cost. On or side, you have to become more agile, cut all flab, that's (lay-offs) inevitable, that will happen with all companies", Balakrishnan said.

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However, he said, growth of Indian IT services companies in general in calendar year 2019 has been stable with reasonable growth. re were fears of slowdown in global ecomies but that impact has t been seen.

"Digital is driving growth. With new techlogies, most of companies are reconfiguring mselves, focusing on digital and also reducing flab with legacy techlogy employees and trying to be more cost-effective and having a better pyramid," he said.

"So, it's a combination of both. Focusing more on digital, that's where growth is, and also reconfiguring employees and slowly moving away from legacy techlogies," he ded.

On prospects of IT services companies in 2020, he said all global ecomies seem to be stable and re are fears of recession.

If y play game properly, it would be a good year for m as re are concerns, Balakrishnan ded.

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