When Uday Singh made it to the Indian Institute of Technology (IIT), Roorkee, in 1998, it called for a lifetime of celebration. On graduating in electronics, Singh was looking forward to being wooed by top Indian and multinational companies with offers of six to seven-figure salaries and the assurance of a secure future. Four years on, celebration is the last thing on Singh’s mind. Not only is he without a job offer—much like his 105 batchmates—but, worse, Singh is not sure whether a business management course at one of the hallowed Indian Institutes of Management (IIMs)—a natural academic progression for many IIT graduates—will augment his employment prospects. For, the placement malaise is widespread, spanning engineering and business schools across the country: the class of 2002 is facing the toughest hiring environment since the early 1990s.

The triple whammy of the three-year-old economic slowdown in India, the six-month-long recession in the US and the it meltdown is finally taking its toll on the campuses: jobs are fewer, salaries offered lower or stagnant, and recruitment practices stricter. The average salary offered at IIM Ahmedabad—ranked among the top 10 business schools in the world by The Economist—fell from Rs 6.7 lakh in 2001 to Rs 5.9 lakh this year. Many institutes, such as iim Kolkata, aren’t disclosing the average salary their graduates were offered this year. Probable reason: salaries don’t match expectations and last year’s high levels.

Global consultancy majors like Arthur Andersen, PriceWaterhouseCoopers and Accenture did not even show up at the iims, the traditional bastions of foreign recruiters. In fact, consultancy firms—the most sought after by graduates—have been virtually absent from the campuses. Investment banks, the other big employers of B-school graduates, have also slashed hiring this year. Such is the fear of insecurity that stability is scoring over relatively plush salary packages, and the once enticing overseas offers are being remorselessly rejected for safer Indian jobs. Rahul Saksena of the Faculty of Management Studies, Delhi, declined a $100,000 (Rs 48 lakh) annual salary job with a Singapore-based trading company for a “safer and stable” Rs 5 lakh offer with ICICI.

Though it firms, along with finance and marketing majors, were still recruiting this year, a marked shift in trend is beginning to emerge. As much in India as in the US, sectors like consultancy and it are beginning to make space for others like insurance, healthcare, pharmaceuticals, bio-sciences and it-enabled services.

The gloom on the campuses of business and engineering schools threatens to spread to other colleges, even those not offering professional courses. At a time when companies can pick up MBAs and engineers for the salary of regular graduates, especially from second-rung business and engineering institutes, the job prospects for plain graduates would dim too.
Warns a placement consultant: “With the job market so tough, MBAs will eat into the employment opportunities for plain graduates. That will only escalate unemployment.”
Add idle hands and eager minds to the already long list of the country’s economic woes.

—Malini Goyal