India's information technology industry may post seventh consecutive year of improving productivity, as automation adds to efficiency and drives down recruiting rates among software services firms, a report in ‘The Economic Times’ has said.
Industry is assessed to have required 16,055 engineers to generate every additional $1 billion of export revenue in 2015-16, compared with 31,846 engineers in 2009-10, according to Nasscom data -- a near doubling of the efficiency with which labour is employed.
Latest figures shows that India's largest outsourcing firms are succeeding at 'non-linear' growth, where revenues upsurge excessively compared with hiring.
Even though numbers are good news for an industry that is trying to defend profit shares, it raises doubts over the future of hiring and availability of engineering jobs in a sector in which over three million people are working.
According to McKinsey & Kotak Institutional Equities data, India's IT industry needed around 3 million people to add first $100 billion of revenue. But, the number of people required to earn the next $100 billion will reduce by about a third to just 1 million people.