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Crash of titans sparks pink slip fears

September 22nd, 2008

NEW DELHI: Mumbai-based Kalpesh Malhotra (name changed) was ecstatic when he joined marquee i-bank Lehman Brothers early this year.

He was among the select few picked after a rigorous recruitment session from one of India’s premier B-schools at an annual salary of Rs 18 lakh. But within months, the dreams of a great future, global jetsetting and meetings with honchos have turned into a nightmare. After the US’ fourth-largest i-bank filed for bankruptcy, there was chaos, panic and despair at its plush Powai office.

Kalpesh is not alone. He shares his uncertain future with about 2,500 employees of Lehman’s India unit and about 23 lakh people employed by the Indian IT and BPO industry. Almost 60% of the IT-BPO companies get their bread and butter from American financial institutions like Goldman Sachs, Washington Mutual, Citigroup, Bank of America, Morgan Stanley and Lehman Brothers.

As financial behemoths crash on the Wall Street, pink slips are being handed out in Bangalore, Hyderabad and Chennai. Reflecting the gloom, leading global HR consulting firm Manpower has drastically downgraded hiring outlook for India. According to the consultancy, hiring outlook (% of companies planning to hire) dipped from 56% to 33% for the quarter ending March 2009 for finance and insurance sectors. For ITITeS , the outlook has shrunk from 58% to 47%.

Experts see a major impact on companies, especially on firms in the banking, financial services & insurance (BFSI), IT and BPO space. According to estimates, MNCs in the BFSI and captive BPO space may axe 5,000-8,000 jobs in the country.
Source:TOI

Entry Filed under: News