Telangana IT Min on layoffs: It's common to lay off few and recruit more

State claims the sector created 24,000 jobs during 2016-17

Telangana IT minister K T Rama Rao on Thursday came in strong defense of the practice of annual layoffs in the information technology (IT) sector as he said that the companies have been creating more jobs than removing people from their campuses.

"It (layoff) is common for (IT) companies. Few people are laid off but more new employees are being recruited by them each year. Why should we object to this," the minister said while sharing his views on the prospects of job growth in Hyderabad.

IT companies created more than 24,000 new jobs in the city during the year 2016-17, according to an annual report prepared by the state IT department.

Last month a couple of associations representing the IT employees had approached the labour departments in various states, including Telangana, seeking an intervention in the alleged large-scale layoffs by IT majors including Cognoziant, Wipro and Infosys.

Incidentally, the labour department of Telangana was the first government body to respond to one such complaint by calling for a joint meeting between the Cognizant Technology Solutions (CTS) management and a group of its employees over the alleged forced resignations.

Rao's comments clear the air on the government's stand on the hire-and-fire system being followed by the IT companies. Before the emergence of Telangana as a state, the undivided Andhra Pradesh had amended labour laws to provide flexibilty to IT firms in taking decisions. 

The minister has released the annual report on IT industry's performance based on software exports from the city. The state has also compiled data on the new jobs created by these companies.

"We had not only regained the lost momentum but also made rapid strides in IT sector after the formation of Telangana state, even though some people had sought to sow doubts in the minds of people over the future of the new state," the minister said. 

According to Rao, IT exports from Hyderabad grew 13.85 per cent at Rs 85,470 crore in FY17 as against Rs 75,070 crore in the previous financial year. Registered growth is 4 per cent higher than the projected growth of the sector in 2016-17.  

According to Rao, Telangana was all set to double its IT exports to Rs 1.20 lakh by 2020. The state also aims to increase job opportunities in the sector in the next few years.