Unlike China, India is lucky to be at the intersection of two significant trends—a young population that comprises our “demographic dividend”, and nearly three decades of experience at creating high-value jobs in IT.
But we’re coasting along on the fumes of the latter, which is already turning the former into a ticking time bomb. Millions of students entering and graduating from colleges are basing their outlooks on an increasingly outdated construct of jobs, careers and employers.
Today, more than a million engineers graduate every year, most with their eyes set on a career as a software engineer. Why? Because their parents saw India’s IT boom happening right in front of their eyes.
However, while India’s IT industry employs around 4 million people today, the number of engineers graduating every year is far more than the IT industry needs. In 2006-2007, India produced around 500,000 engineering graduates, according to figures from the All India Council for Technical Education (AICTE). By 2017, 1.5 million engineers were graduating annually, most of whom the IT industry simply had no room for. As a result, campus placements for graduates of AICTE-affiliated engineering colleges now hover around the 40% mark.
The advent of the IT industry changed the face of the middle-class India completely. By the early 2000s, an IT job was the default path to ‘safe’ employment for most-middle class Indians, in many cases even usurping the previous claimant of that throne, the hallowed government job.
But nearly two decades of growth has led to many myths and misconceptions that students often buy into.
All software jobs are similar
Similar opportunities to travel abroad, similar salaries, and job security.
This myth exists because students and professionals do not spend nearly as much time as they should to understand the business models of their potential employers.
Most IT companies make money through hardware and software, but the devil is in the details.
Some make money by building software, like Microsoft does with Office and Google does with Gmail. Others, like Intel and Samsung, focus on hardware, designing and manufacturing everything from microchips to smartphones. A third broad category of companies builds software that allows them to offer services at unprecedented scale. For example, Uber and Amazon.
These days, most large companies do all three to one degree or another. Because the combination of hardware, software and services is what is typically called a product. And everything these days revolves around great products.
Great products generally help the people using them save time, money and effort; e-commerce products like Flipkart and Amazon let you buy things quickly and cheaply, ridesharing products like Ola and Uber simplify commuting while office productivity products like Word and Excel make writing and accounting easier.