In today’s rapidly changing job market, upgrading skills for emerging technologies is critical for staying relevant. As global uncertainties mount, companies are cutting costs and offering fewer entry-level positions, with the IT sector feeling the brunt of these challenges. The convergence of global economic instability, reduced technology spending, and increased competition from new tech hubs has created a difficult landscape for fresh graduates, particularly in the engineering sector.
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The Declining Job Market for Engineers
India’s engineering graduates face a tough job market. With approximately 1.5 million engineers graduating annually, the market has become oversaturated, leading to a significant reduction in job placements. For instance, in 2024, 25% of students at IIT Mumbai did not secure employment during campus placements. The starting salary packages, which used to be at least six lakh rupees, have fallen to four lakh rupees. This downward trend isn’t limited to IITs; NITs and other engineering institutions across the country are experiencing similar challenges.
According to experts, the drop in placements is linked to a decrease in investment in technological innovation and business growth. Increased specialization in IT has reduced the number of entry-level positions, and widespread automation has shifted demand toward candidates with new, advanced skills. Moreover, technological advancements are reshaping the job market, affecting older companies and traditional roles.
Tech Layoffs and Global Economic Uncertainty
In August 2024, tech companies announced massive layoffs, affecting over 27,000 engineers. Major players like Intel, IBM, and Cisco reduced their workforces, citing the need to focus on skill enhancement and technological development. According to Layoffs.fyi, a website that tracks layoffs, approximately 1.36 lakh employees globally lost their jobs by September 2024, with Intel laying off 15,000 workers and Cisco cutting 7% of its workforce.
The global recession, geopolitical tensions, and the rapid adoption of automation have led companies to restructure their operations, making it harder for new graduates to secure well-paying jobs. This trend, coupled with the influx of new engineers, has created a saturated job market with fewer opportunities for those entering the workforce.
Reasons Behind the Declining Salary Packages
The reduction in salary packages for engineering graduates can be attributed to several factors. Rituparna Chakraborty, co-founder of TeamLease, highlights the mismatch between job demand and supply in the IT sector. The traditional belief that an engineering degree guarantees employment no longer holds true. Outdated curricula fail to equip students with the skills necessary to navigate the rapidly evolving tech landscape.
Mamta Shekhawat, founder of Gradding, notes that even top institutions like IITs and NITs are experiencing a decline in campus placements. The slowdown in the IT sector is being driven by economic uncertainties, geopolitical tensions, and swift technological changes. Siddharth Maurya, founder of Vibhavangal Anukulkara Private Limited, points out that rapid technological advancements, particularly in AI and automation, are a major factor in the dwindling opportunities for graduates from prestigious institutions.
The job market has shifted from a period of abundant job openings to one where demand has drastically decreased. As Saurabh Nanda, a career counsellor, explains, while the engineering sector still offers jobs, most are low-paying. The global economic slowdown, combined with India’s “jobless growth” phenomenon, means that economic progress does not necessarily translate into more employment opportunities.
Bridging the Skill Gap and Focusing on Fundamentals
One of the main challenges contributing to the declining job market is the widening gap between the skills required by industry and those possessed by graduates. According to Raghunandan Sarraf, CEO of Saraf Furniture, this skill gap has always existed but is now more pronounced due to global economic uncertainties and the changing business models of tech companies.
Ramprakash Ramamoorthy, Director of AI Research at ManageEngine, Zoho Corp, emphasizes the importance of mastering core concepts like programming, operating systems, and networks. While technological advancements continue to reshape industries, these foundational skills remain essential. Ramamoorthy suggests that students should focus on building a strong foundation in basic programming and statistics, especially when pursuing careers in AI. A solid grasp of these fundamentals can help students adapt to future technological changes.
The Importance of Upskilling
As traditional IT roles diminish, the demand for professionals with specialized skills is increasing. Rituparna Chakraborty points out that Indian students have long relied on their engineering degrees to secure jobs, but this is no longer enough. Companies are now seeking better-skilled candidates at lower salary packages, even from institutions outside the IITs. However, students with superior skills are still securing top-tier job offers.
The rapid pace of technological change requires continuous upskilling. According to Siddharth Maurya, the demand for skilled professionals is rising, but educational curricula are not evolving quickly enough to keep pace. Emerging technologies such as cloud computing, big data, and artificial intelligence are opening new career pathways, but they require advanced technical knowledge and specialization.
Exploring New Career Opportunities Beyond IT
Despite the challenges in traditional IT roles, new opportunities are emerging in other sectors. Global Capability Centres (GCCs) are providing better prospects for Indian IT professionals, although competition remains fierce. Mamta Shekhawat advises students to assess the challenges and opportunities in this sector before making a decision.
Beyond IT, areas like cybersecurity, data science, machine learning, and artificial intelligence are seeing significant demand for skilled professionals. Additionally, industries such as renewable energy, biosciences, and the Internet of Things are offering abundant job opportunities. To improve job prospects, students should focus on developing skills in these high-demand areas. Educational institutions are also restructuring their curricula to prioritize practical skills and emerging technologies, while the government is promoting research and development to encourage innovation.
Diversifying Career Paths: Beyond Engineering
India should not rely solely on IT engineering to drive its job market. As Rituparna Chakraborty suggests, exploring opportunities in sectors like manufacturing and logistics can provide students with new career avenues. Adopting a forward-thinking approach and learning future-oriented skills will help graduates meet the evolving demands of industry.
According to Saurabh Nanda, while job opportunities in the engineering field may decrease, other sectors such as computer science, medicine, and accountancy are poised for growth. Specialization will be key to success in these fields, with mentorship emerging as a promising career path. In India, industries like healthcare and hospitality are also expected to provide good job prospects in the future.
As the demand for basic engineering skills declines, specializations will become increasingly important for securing employment. Students must embrace these changes, continue learning, and upskill to stay relevant in a competitive job market.
Conclusion
The evolving job market is reshaping career opportunities for engineering graduates in India. While challenges like global economic uncertainty, automation, and technological disruption persist, students who focus on building fundamental skills and embracing new technologies will have the best prospects. Diversifying career options, exploring emerging fields, and continuous upskilling will be essential for navigating the changing landscape and securing future employment.
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FAQ
Why is the job market declining for engineers in India?
The market is oversaturated with approximately 1.5 million engineers graduating annually, leading to reduced job placements and lower starting salaries.
What factors are contributing to the reduction in salary packages for engineering graduates?
Factors include a mismatch between job demand and supply, outdated curricula, economic uncertainties, geopolitical tensions, and rapid technological changes.
How has the global economic situation affected the tech job market?
Global recession and geopolitical tensions have led to massive layoffs in tech companies, with approximately 1.36 lakh employees globally losing their jobs by September 2024.
What is the main challenge contributing to the declining job market for engineers?
The widening gap between the skills required by industry and those possessed by graduates is a significant challenge.
What skills should engineering students focus on to improve their job prospects?
Students should focus on mastering core concepts like programming, operating systems, and networks, as well as building skills in emerging technologies like cloud computing, big data, and artificial intelligence.
Are there new career opportunities emerging beyond traditional IT roles?
Yes, areas like cybersecurity, data science, machine learning, artificial intelligence, renewable energy, biosciences, and the Internet of Things are offering new job opportunities.
How can students stay relevant in the changing job market?
Continuous upskilling, exploring emerging fields, and diversifying career options are essential for staying relevant.
What sectors, besides IT, are expected to provide good job prospects in the future?
Sectors like manufacturing, logistics, computer science, medicine, accountancy, healthcare, and hospitality are expected to offer good job prospects.
How are educational institutions responding to the changing job market?
Many institutions are restructuring their curricula to prioritize practical skills and emerging technologies.
What role does specialization play in securing future employment?
As the demand for basic engineering skills declines, specializations are becoming increasingly important for securing employment in various fields.
