Sr Techies In Demand As AI Gains Traction

Bengaluru: Demand for experienced engineers is growing in the Indian IT industry as the advent of AI and Generative AI is lowering the demand for entry-level engineers. According to sources in the know, such demand scenario is opposite to traditional staffing of IT firms, which has been heavy with entry-level staffers.

“As more entry-level IT works are getting automated through AI & GenAI, the traditional pyramid structure of staffing is undergoing some change. Now, the staffing structure is moving towards diamond shape,” Pareekh Jain, an IT outsourcing advisor & Founder, Pareekh Consulting, told Bizz Buzz. In pyramid shape staffing, more number of employees are at the bottom performing routine tasks, with fewer managers and executives at the top making executive decisions. Indian IT industry, since its inception, has been following pyramid structure of staffing where in more number of freshers man operations at the bottom. That is the reason that bulk hiring has been one of the leading staffing phenomena in the Indian IT industry.

In diamond shape of staffing, there are fewer people at the bottom and more experienced hands in the middle with again lesser number of executives at the top.

According to HR experts, automation is enabling Indian IT firms to provide entry-level work without human intervention. Therefore, fresher hiring is likely to dip in the coming years. Management of some IT services firms have already indicated this phenomenon playing out in the near-term. HCLTech’s CEO, C Vijayakumar has said in the recently held Nasscom summit that the current business model, which has relied on increasing staff to boost revenue growth, has turned obsolete. The company is aiming to earn 2x revenue through employing half the workforce by leveraging AI-driven automation.

Similarly, Infosys’ management has said that Indian IT firms have to shift to outcome-based business model from established model of input-based models. Meanwhile, companies have started process of hiring experienced staffers through lateral hiring method. Infosys recently advertised for hiring experienced hands in 40 plus skillsets. The company is looking for an experience of minimum two years for applying for these positions.

“As AI-led automation is playing out fast, many companies are being cautious in terms of hiring of entry-level talent as of now. Moreover, tepid demand environment is contributing to this phenomenon,” said an HR expert.

It is to be seen that how lower number of entry-level hiring impact the operating margin of the IT firms in coming quarters.