The machines are creating mayhem again.
The fear of automation, and its corollary, job loss, has been real for years. Now it is the turn of the $150-billion Indian IT industry to grapple with the effects of the increasing use of advanced technologies involving artificial intelligence and machine learning. The reported layoff plans at tech firm Cognizant Technologies has set off alarm bells among its employees as well as the larger technology workforce of India. The employees on their part have responded by closing ranks and approaching government authorities for reprieve and support—a clear hint at the increasing unionisation of the sector.
The unfolding scenario could offer a glimpse into what the future holds for the industry if this transition is not handled well.
The Cognizant conundrum
In a letter dated May 05 to the labour commission of Chennai, the Forum For IT Employees (FITE), said that Cognizant is forcing employees to resign after giving them the lowest ratings in performance appraisals. ”…the employees are forced to sign a voluntary resignation letter so that it cannot be claimed as termination. Because of this, employees are not getting the compensation, they are eligible for,” FITE, which consists of employees of over 50 Indian IT firms such as Infosys, Tata Consultancy Services, and Wipro, said in the letter. Until now, these employees were never given any negative feedback and were generally performing well, the group said. Quartz has a copy of the letter.
“If it (labour commissioner’s office) doesn’t take any action, we will pursue legal proceedings. Cognizant is not being transparent with employees and only looking at making profits,” Vinod AJ, FITE general secretary, said.
FITE’s letter came following media reports in March that Cognizant would lay off some 6,000 employees due to the impact of automation. Then, on May 05, the Nasdaq-listed firm said it will increase local hiring in the US amid concerns of a crackdown on the H-1B visas.
However, in a statement to Quartz, a Cognizant spokesperson said there haven’t been any job-cuts. “Cognizant has not conducted any layoffs. Each year, as is the best practice across our industry, we conduct performance review to ensure we have the right employee skill sets necessary to meet client needs and achieve our business goals. This process results in changes, including some employees transitioning out of the company. Any actions as the result of this process are performance-based and generally consistent with those we’ve made in previous years,” the spokesperson added.
Meanwhile, Infosys, India’s second-largest IT firm, too, has said it intends to hire 10,000 locals in the US and has laid off some 9,000 employees due to automation. Other IT firms are adopting similar strategies. Clearly, this is a sign that the Indian techies’ harvest season may be coming to an end unless they adapt and upgrade quickly.
In India, by 2021, one in four jobs may give way to automation, according to HR solutions firm PeopleStrong. Some 23% of the total global job loss due to automation will be in India.
This churn is similar to what happened during earlier waves of automation. For instance, a number of British textile workers and weavers—known as Luddites—lost their jobs in the early 1800s following industrialisation. Advanced technologies were incorporated by merchants to cut costs and workers were reduced to merely operating the machines.
While it was the working class that was worst hit then, today it’s the white collar jobs. “Automation has really moved up the income ladder. It’s not just taking away jobs with your hands. It’s taking away jobs from your mind. The difference with the Luddites is that automation is moving up the job chain,” writer Clive Thompson told Quartz in April.
All this is leading to unionisation of the corporate class. For instance, FITE’s objective is to give voice to the millions of IT employees in the country. “Yes it is a form of unionisation. The IT employers already have a union which is called NASSCOM. But we don’t have anyone,” said Vinod. The point is not to oppose the management on everything, but to demand a fair working environment, he said.
IT solutions of a different kind
While some job losses are inevitable, IT companies can try and minimise the impact. For instance, work hours can be streamlined, said Vinod: “An employee typically works for 10-12 hours a day. So, instead of getting rid of the employee, the company can reduce his or her work hours by using technology.”
Besides, skilling and re-skilling are key, say experts. ”It is important that employees are constantly trained and most companies already have structured training programmes to keep employees relevant. It ensures that the threat of automation doesn’t discourage employees,” Sangeeta Gupta, senior vice-president of NASSCOM, said.
“While some jobs will be destroyed because of automation, there will be new jobs that’ll be created too, so skilling again is important,” Gupta said. Mid-managers also need to brush up their domain skills, because “the pure people-management jobs will go down,” she said. “And companies will critically look at people who aren’t adapting to those changes,” she added.
Companies have already launched re-skilling drives. “We expect to have about 100,000 employees retrained by the end of this year in the most specialised areas of digital,” the Cognizant spokesperson said. NASSCOM itself plans to build one such tech re-skilling platform.
Apart from initiatives from the private sector, the government can do its bit, too. Policy initiatives like providing basic incomes can help during distress, a March 2017 report (pdf) by PwC India and Assocham (an industry body), said. “If a large number of people end up unemployed for extended periods of time, there needs to be a way to provide healthcare, disability and pension benefits outside employment,” the report added.
The robots may be coming, but the future needn’t be dominated by the Terminator.