“Downturn is like baptism with fire. The day I surrendered my ID card, I was really down. It was a long day,” expresses Suhas (name changed). Twenty-two year old Suhas started working with Sasken, a leading Bangalore-headquartered communications solutions technology company, in August 2008 as a fresh graduate. By the time he finished his six months training for his position as software engineer, the economic slowdown had hit his company.
“The trouble started in October, bad news started pouring in. We were under constant apprehension. We thought we would go in December. In December, the firm started firing senior people. Freshers weren’t touched till then. But in a month’s time there was a 40 per cent salary cut for freshers. This was for those on the bench (the term ‘bench’ refers to those who are not working on any particular project for a clientand await being assigned). And a month after that there was a further 10 per cent cut for all freshers,” he explains.
His unrest is well expressed when he says, “People start doubting your competency (when you lose your first job itself). My family has been very supportive.” He further explains, “Around 15th January 2009, we were given two options: resign or go on leave without pay for 12 months.” Suhas has loan payments pending for his Koramangala flat, where he lives. While it might be a little harder for Suhas, this being his first job, he is not the only one who is hit by the economic downturn.
Lakshmi Menon lost her job with Sirf Technology, when the semi-conductor firm closed its Bangalore operations. A total of 100 employees lost their jobs. She feels those with financial liabilities like home loans to repay are more into trouble. “Most of my friends where both spouses have lost the jobs and also have a home loan to be repaid, they are seeing a sea change in their lifestyles. In our company’s situation, the whole team lost their job and, therefore, we were not morally disturbed. But in a lot of other cases (friends) I have seen employees going through depression.”
Lakshmi thinks she is able to cope with this situation because she has a working husband whose income is enough for financial stability. Therefore, she is able to indulge into her fields of interests while searching for a job simultaneously. She lives in Magadi Road and usually visits various parts of the city to attend art exhibitions. “I always liked art and painting so these days I am visiting art exhibitions and writing about them. At the same time I am investing my time into theatre production and learning soft skills,” she says.
While Lakshmi shows a positive outlook towards dealing with this situation, Harsha Kumar, an analyst with a business and IT consulting firm feels that companies during this time should be more transparent and they should think about retention of work force. “For the past six months there have been problems in the company. They have started charging us for food and transport. I was promised a hike of 50 per cent. I actually got a 25 per cent pay cut. I was informed about this on a one-on-one basis. Company didn’t communicate most of the things properly to us. They just sent us an e-mail. My personal spending has come down. I am buying cheaper stuff now. I am looking for another job,” he explains. Harsha stays in Malleshwaram.
Most employees who are either seeing layoffs or severe cost cutting in their company are seen restless and worried. Santosh (name changed), one of the team leads in the IT department of ST Microelectronics. goes further and says that even cost cutting measures are making employees anxious and worrisome. “Our company is taking up various cost cutting steps including forced leave (without pay) of five working days. This will help the company keep less money reserve as annual leave will be less for people. At the same time there are job cuts, a hiring freeze, contract employees are being relieved and pay hikes are off this year,” he says. “There is a constant fear of losing jobs and pay cuts amongst the employees,” he explains.
Job-seeking patterns are changing too. Ashish Chitravanshi, Manager Tech&Marketing, CareerNet Consulting, a recruitment consulting firm, says there is a distinct shift. “The number of people who are simply looking for a change has reduced. At present, more and more resumes are of people who will take up all/any offer that comes their way. There are actual job seekers,” he explains.
Coping with the crisis is that much harder because layoffs do not sit well with Indian society, market experts feel. V Ravichandar, CMD, Feedback Consulting, says that in the West being laid off is accepted socially. But in India it is not the same. “First of all there is no social security net and there is a stigma attached to it. People here do not accept this (being laid off) that easily and are apprehensive towards getting counseling. They are not sure how to cope with it and are not ready to meet counselors also,” he opines.
On this, Lakshmi Menon shares, “One of my friends (she withheld his name and his firm) lost his job and for two months he was unable to even tell his wife. Everyday he used roam around the whole day. Eventually he told the reality to his wife but he is in total depression. He spends most of his day in the church praying. Social acceptability about being laid off is not easy in India. Men are more affected with the lay off than women.”
While the social stigma and apprehensions on personal levels are suspected as reasons for people not seeking psychological help, Dr B S Devi Pramila, Consultant Psychiatrist, says there is more. She claims, “The numbers of cases we are getting have reduced because people don’t have the money to spend now. Earlier, the company would pay for any hospital treatment. Now they have to pay from their own pocket, and people don’t have the money to pay.”
Pramila however adds that the projection of this entire scenario in a depressive manner is wrong. She says, “This needs to change because it will only make people more depressed. Stop looking at the downturn in a negative manner. Be positive. There are many people who are in the same boat. Look at what else you can do with your time.”
She further suggests, “For young people, they still have many years ahead. They should look at alternate options. This kind of a situation teaches us that we should always plan ahead. Always keep your creative side active. Be optimistic.”
That apart, the reality is that there is a sea change in the work atmosphere. Payal Shah, a city-based organisational behaviour expert says, “Employee morale has definitely gone down. The reason might not solely be lay offs and the slow down, but also various other factors like too much work, no work at all, working longer hours, job insecurity and so on.” To cope with this problem many companies are conducting workshops and seminar for the CEOs and employees.
Payal feels that workshops or seminars to boost employee morale is only a short-term method of dealing with any problem. A more effective way would be for the management to effectively communicate with the employees, hear their views and address them, she says.
With job insecurity on the minds of many, people just want to keep the job they have because there are not enough jobs on the market and also a move does not guarantee a higher salary, says Payal. “For example, the BPO organisations have seen a steep drop in attrition since the downturn as compared to 12 months ago. So it has become easier for companies to retain employees,” she adds.
Everybody is, at some level or the other, affected.
“On personal level people who have not lost jobs are also cutting down on their spending. A general tendency in IT employees was to go out shopping every weekend. Even an employee with one year experience will have a fully furnished home not because he needed everything but because he could afford it,” says Lakshmi Menon. She further adds, “Now everybody is thinking a lot before buying even small things. Weekend parties have totally stopped. People are not going to high end hotels, they prefer smaller restaurants. Some of them have even stopped eating at the office canteen and bring lunch from home.”
V Ravichandar of Feedback Consulting adds, “On individual levels people are unwilling to spend, therefore, the places where people spent are getting hit. Now most people watch movies at home and do not want to spend on the hefty tickets at the multiplexes. Now if someone has to go out for dinner there is no need to book a table beforehand. “I, myself, experienced this when I was having a drink at Firangi Pani in Koramangala’s Forum Mall, its associate restaurant Sahib Singh Sultan’s attendant came up to me and asked me if I need to have dinner there and if I had booked a table. This restaurant in my earlier visits used to be so crowded that I could never eat without prior booking.”
Psychiatrists and behavioural experts may counsel people, and yet there is always need for a social network as a form of self-help. The IT and ITeS Employees Centre (ITEC) is one such group formed by and for the IT workers in January 2009, based in HSR Layout in south Bangalore. With a membership of nearly 50 people and growing, it serves as a platform to help members of the IT workforce collectively address issues and challenges including economics, exploitation and ethics.
Suresh Kodoor, President, ITEC says, “There aren’t any trade unions in IT. This organisation is like a forum and a coming-together for the employees. Employees would want to discreetly give us information about their problems.” Kodoor claims that as a forum, ITEC takes up matters with company human resources (HR) officials. He declined to disclose names of such companies, saying that the conversations were informal in nature.
Rakesh Soundarajan (name changed), a member of ITEC and senior employee at CISCO, feels that this is the time when they all need to come together. He thinks joining this group has helped him and his likes improve their morale. He also feels that companies in India need to have a layoff compensation policy. “Here it is not an official layoff. You will rarely come across a person with a termination letter. Either she/he is put through circumstances that force him to resign or the company bluntly asks them to resign instead of giving termination orders,” he explains.
G Manjunath, Deputy Labour Commissioner (Publicity and Statistics), has something more on unions and IT workers. He explains that the Industrial Disputes Act of 1947, a central law, defines an industry and there is no definition of software in this law. Also, the law is not applicable to IT companies because they are registered under the Karnataka Shops and Commercial Establishments Act, which is a state level Act. “IT companies do not fall under the definition of ‘industry’. IT employees also don’t fall under the category of ‘workman’. But with regard to layoffs, the Industrial Disputes Act is applicable. This Act has retrenchment and layoff procedures,” he adds.
Manjunath notes that no one in Bangalore (IT sector) has approached the labour department. He however adds, “If they approach us, we will help them. We will talk to employees, discuss, send notices. They can come to us.”
Unorganised sector no less affected
White collar workers are worried and tense and the unorganised sector is no less affected. The latter usually deals with small or middle level entrepreneurs, local businesses like stationery and grocery shops, construction workers, maids, drivers and so on. “The unorganised sector is hit equally but its not visible,” says Ravichandar. When a big company gets hit, the smaller companies dealing with it also get hit equally or sometimes even badly.
Sreedhar T S is a member of one of Bengaluru’s four chapter of Junior Chambers International (JCI), an organisation of entrepreneurs and students. JCI mostly has middle and small level entrepreneurs in the age group of 18-40. An interior designer by profession, he explains, “If a small stationery business is earning only by supplying welcome kits to some big IT companies then this small business will get totally affected if the companies stop providing welcome kits.”
Sreedhar owns Indigo Infocom, Interiors and Turnkey Projects, further narrates his own example, “I have immigrant workers and craftsmen from Rajasthan and Bihar who do carpentry, painting, flooring, et cetera for me. Usually I give them an annual leave of 15 days but this time I have sent them all home for a long leave of more than 45 days. If they are here I will have to find some work for them and then I have to take care of their food and shelter.”
Sreedhar only does corporate interior designing projects. “I never accepted any order for less than Rs.7-8 lakhs but now there are no orders of that amount. Now days I am taking up orders of Rs. One lakh and I am even taking up repair work. Seventy per cent of my orders are on hold and in all of them I have already put money from my pocket for the preparations.”
His views are backed by LabourNet, a job providing organisation for the unorganized sector. LabourNet offers jobs, social security and training for construction workers, maids, drivers, plumbers and more. Gayathri Vasudevan, one of the founders says, “Mostly the big builders have brought workers from outside the state from Bihar and Uttar Pradesh luring them for better wages. With the coming of economic slowdown, daily wages of these workers have gone down and they are now left nowhere as they had relocated from thier native place. These workers are coming back to us and asking us to find other jobs for them. But there are no jobs in the market. These people have no option but to either go back to their native place or keep waiting for opportunities.”
LabourNet has employed over 6000 workers through their network but now more and more of them are coming back without jobs.
With downturn in Bengaluru seeping through the companies and employees alike and from there down to service providers, few have been left untouched. Even as you read this article, some of you might be wondering about what is in store at work today. A few of you might be worried about your sales prospects and others about keeping existing customers. However, keeping a positive outlook is perhaps the only way out, as psychiatrist Pramila says. There is still hope that the employable workforce will get out of this crisis. ⊕
I would say “the economic downturn has given an excellent opportunity for the parents to think that engineering/medical is not the only option for their children.” Most often it’s parents who decide about their children’s future. I hope those parents will now change their mentality and let their children decide what they want to be. I believe engineers are suffering the most in this economic turmoil and those unlucky one’s who were not inclined in choosing engineering as a profession, and are now doomed to become one, must be cursing their parents.
Driving the discussion to a slightly different direction, the economic downturn has given an opportunity for the freshers to give time to think about what they really want to pursue in their life. Quite a significant number have plunged into engineering and related fields in line with herd mentality and not because it was their calling. Although I agree that this is no consolation for a job loss, its something that needs to be given a thought.
Hey Supriya, good article, all types of affected people have been covered around Bangalore by you…the recession is particularly hard on freshers, who mistake their job loss as their own failure or lack of skills. Tough times…
There is lay-off every now and then in various companies. Even the outsourcing market is suffering from the recession in whole world.
For those people who have huge loans on head, recession has become a disaster. But we cannot do anything about it. We should be positive and look forward.This can be a time to start a new venture. If we seriously plan and instead of breaking down,if we bring our creative ideas and the hidden talents in front then “Downturn and getting laid off can become a blessing in disguise”, as happened to the founders of Althea Systems.
I know it’s tough on those who lost their jobs, but I completely agree with Lakshmi Menon that this downturn has helped in curtailing unnecessary spending, which was driven by affordability rather than necessity. I am happy that prices of day to day needs are coming down as there is less demand and the purchasing power is coming down.