AI and new wave of offshoring mean graduates can’t get gigs
Feature Shubh Kumar graduated from IIT Patna, one of India’s famed Institutes of Technology – universities that attract millions of applicants but admit only 18,000 undergraduates.
Google CEO Sundar Pichai and IBM boss Arvind Krishna are both IIT alumni, and employers seek out IIT students. New grads are generally optimistic that attaining a degree at one of the 23 institutes is a great start to a career.
But that dream didn’t come true for Kumar. Weeks before he was due to join a local startup as a software development engineer, the company revoked its job offer, citing “significant consolidation” and an “extremely challenging financial position.”
The news left him reeling.
“I was prepared to begin”, Kumar said. “Now I’m back to zero, just trying to stay confident”, he told The Register.
Kumar’s story is a familiar one across India’s university campuses, where information technology students increasingly find that employers aren’t interested in taking on early career workers.
The country’s top five IT services firms, once a common destination for young engineers, hired around 100,000 graduates in FY 21 but are projected to employ only 70,000 by FY 26.
Other companies are also hiring fewer early-career IT pros. Data from tech staffing and HR services firm TeamLease suggests graduate hiring by Indian tech companies peaked at 600,000 in FY 21-22, then plunged to 150,000 in both 2023 and 2024.
Over half of the 23 Indian Institutes of Technology (IITs) saw graduate placement rates fall by more than 10 percentage points between 2021-22 and 2023-24, according to the “Demands for Grants” report [PDF] prepared for India’s Department of Higher Education.
A Parliamentary Standing Committee called this decline “unusual”, noting similar trends at other universities and shrinking average starting salaries. The committee has urged the Department of Higher Education to find ways to boost student employability.The impact of AI
Experts see a structural change in India’s IT sector, with AI and other forms of automation reducing the need for entry-level coding and support roles.
“Routine, rules-based roles such as manual testing, basic application support, and low-level coding have been most impacted”, said Neeti Sharma, CEO of TeamLease. “Generative tools deliver these outputs faster, cutting the need for large fresher intakes.
