Vanishing Graduate Tech Jobs Worsen Modi's Headache Before Elections

For years, India's tech graduates could bank on a job offer from one of the country's IT giants. Now those starting positions are suddenly waning, leaving hundreds of thousands in peril and creating a fresh headache for Prime Minister Narendra Modi. From a report: Infosys and Wipro were among companies that shocked students nationwide last month, saying they were cutting college recruitment as demand for their services cooled across the globe. The unusual pullback from the $245 billion industry risks exacerbating youth unemployment in the world's most populous nation, a potential scar on Modi's ambitious plan to keep India growing at a fast clip and make it the third-biggest economy during his reign. The high-profile problem of youth joblessness also gives the opposition another rallying point ahead of next year's elections, in which Modi is trying to snag a third term that would extend his tenure to 15 years.

The tech-services industry is one of the largest employers in India, and accounts for 7.5% of the South Asian country's more than $3 trillion economy. The biggest tech companies have each traditionally hired tens of thousands of tech graduates every year, then rigorously trained them for tasks such as writing software for some of the world's biggest enterprises ranging from Apple to PepsiCo. The IT companies hired particularly aggressively in the past two years as the pandemic prompted customers to spend on services and technologies enabling remote working. The top two IT companies, Tata Consultancy Services and Infosys, hired more than 284,000 graduates over that period combined. Now the uncertainty caused by Russia's attack on Ukraine as well as high global inflation and interest rates are causing customers around the world to hold off on spending. Meanwhile, technologies such as artificial intelligence are increasingly performing tasks previously handled by entry-level IT workers.

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