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Recession is almost a thing of the past and there is a reason to smile as hirings are back. However, the IT sector continues to be plagued by the poor quality of software engineers churned out by colleges in the country. Most of those hired are still not industry-ready. While India produces close to 500,000 graduates from its engineering colleges every year, the industry is unanimous about their inadequate skill sets. According to a Nasscom estimate, only 25% of the engineers graduating are employable.

The software industry's demands and the universities' quality of academic supplies have not been tallying for a while. As universities fail to adequately prepare students for the professional world, most IT companies are forced to increase the duration of training and consequently annual expenditure.

Infosys (INFOSYS.BO : 2701.2 +28.6) chief financial officer V Balakrishnan is of the view that the current curriculum in colleges needs to be altered for producing better students. "The syllabus should be aligned to the needs of the industry. At Infosys, we having to train and retrain candidates, though we have a strict screening process during recruitment," he adds.

Last year, Tata Consultancy Services (TCS.NS : 818 +21.05) (TCS) increased its training period from three months to six months. Infosys, known for its lengthy and rigorous trainings, has been spending $175 million annually on training programmes. According to information provided by Infosys, the company expects this spend to increase marginally with the new training schedule in place. Currently, it spends $5,000 towards training of every employee it hires.

The country's third largest software firm, Wipro (WIPRO.NS : 728.65 +18.6), has an induction training of three months for fresh campus recruits. "We spend approximately 0.65% of our revenue and this percentage has remained constant over the years," says Selvan D, senior vice-president, talent transformation.

IT sector is a people-based industry requiring niche skills. While it could be difficult for freshers to be equipped with all the skill sets, a little more than some basic knowledge is expected, say experts. "We would obviously need to equip our students with the relevant subject matter expertise and soft skills. However, certain basic knowledge is expected of the students. In our education system, neither the content nor the delivery is adequate. Education must be made relevant at the outset," says Nasscom president Som Mittal.

Experts feel the talent available needs to be aligned to requirements of the industry to race ahead of competition in the global market.

According to Nandita Gurjar, senior vice-president and group head of human resources, Infosys, "The skill gap is due to the lack of active partnership between the industry and universities." She, however, is of the view that the industry needs to work with all stakeholders to address the employability issue effectively and identify ways and means of empowering students.

The industry has been suffering for years with market-ready talent becoming a rare commodity. The requirements of the companies keep changing too. Pratik Kumar, Wipro's executive vice-president, HR, agrees to the existing skill gap but sees the situation differently. "Potentially, the students are smart. I don't blame them for not having the required skills because the industry requirements keep shifting. So the organisations have to do their own bit to ensure they are competent."

Academics, on their part, have own set of woes. According to S Sadagopan, director, IIIT Bangalore, more emphasis is given on college infrastructure in India while there are no good teachers to teach in most colleges. "Corporate houses like L&T, Mahindra & Mahindra, Godrej (GODREJCP.NS : 275.35 +4.45) and Wipro should be persuaded to set up colleges and universities. Unfortunately, the present system does not encourage this," he says. While every MLA or MP can start a college, the system makes it difficult for good corporate houses to do so, Sadagopan adds.

However, given the demand-supply gap, job seekers have reasons to rejoice. In tune with its guidance at the beginning of the quarter to hire 15,000 people for the next year, Infosys has already made 9,000 campus offers this year. Wipro has not given a guidance on the hiring numbers for the year but has said it will, in the next two quarters, appoint 7,500 from campuses. TCS, the country's largest software exporter, plans to hire 30,000 employees in the financial year 2010-11.