One million IT staff will continue work-from-home post-lockdown: Kris Gopalakrishnan

Multiple million it employees are expected to continue to home based even following the coronavirus-inflicted lockdown situation returns to normalcy, says IT industry veteran Senapathy (Kris) Gopalakrishnan.

The former President of the Confederation of Indian Industry (CII) said the IT services industry has actually were able to transition people to home based through the ‘stay-at-home’ period.

“And that had not been a trivial task. A significant number of people who've to be supported with technology infrastructure to home based; business processes should be changed, with client permission,” the co-founder of IT services firm Infosys Ltd told P T I.

“Now I am told that 90 to 95 per cent of people in lots of of the bigger (IT) organisations will work out of home.  And that transition has been smooth and done very, very quickly. They have figured that out and I believe this will now become part and parcel of the business enterprise continuity processing, planning later on,” Gopalakrishnan said. 

The Chairman of early stage startup accelerator and venture fund, Axilor Ventures, also said that many of the smaller Indian startups have discovered that they are as effective working out of home and are now wondering whether they require permanent office space at all.

“We (India's IT services companies) aren't going back to business as usual,” he said, adding, firms would execute a rethink on any office space they might require and “how exactly we need to deliver services later on.

Gopalakrishnan believes at least 20-30 % of IT employees would continue steadily to home based even following the lockdown is lifted and the problem returns to normalcy.  That accounts for about 1.2 million people, he said noting that four million professionals work in India's IT-Business Process Outsourcing sector according to industry body NASSCOM figures.

“Some companies will be many more aggressive (more people will continue to work from home), the smaller the firms lot more aggressive they'll be, so that they are able to save significantly regarding rental costs.”

The former CEO and Managing Director of Infosys said he will not see job losses in the IT sector but “I don't see recruitment happening.”

He indicated that salary cuts would happen in the IT sector.

“IT sector will not see large-scale layoffs, they have the ability to hold on to their workers nonetheless they don't recruit, they stop recruiting because growth is not there,” he said.  He said lot of folks estimate that the impact of the coronavirus pandemic will be felt for 12 to 1 . 5 years which ensures that recruitment will be “nil or slow” for the main one and half years.

“That’s likely to hurt people who passed out this year and could be next year.”

“Yes, that’s one way it is possible to avoid layoffs,” he said on possible earnings cuts. “Everybody takes a small salary cut. When the complete economy is in decline, we will see zero growth or muted GDP growth this year; so, which will have effect on compensation and recruitment.”

“Typically, during the past what has happened (in the IT industry) reaches the lower levels there is absolutely no wage cuts, as we go up it will be five per cent, ten per cent, and at the very top it could be 20-25 %, Gopalakrishnan said when asked about the possible selection of earnings cuts in the IT sector.