According to a bi-annual report, by the Confederation of Indian Industry (CII) , Southern Region, Bangalore's IT industry has been hit by the global recession. The city has witnessed a fall of about 5 per cent in manpower utilisation and a fall in employment levels by 3 to 5 per cent during the April-September 2008 period.

The report also said that there was also a decline of 2-3 per cent in pricing (billing) during the first half of the current financial year as against the last half of the previous financial year. However, IT industry revenue and overseas billing increased by five per cent.

The report said that the decline in demand due to the economic crisis in the US and also the decline in demand from regions like Europe are the major concerns for the industry.

However, on the brighter side, industry leaders forecast that demand for services from the IT sector would go up by 5 per cent during October 2008-March 2009 and revenue would also go up by 3 to 5 per cent.

Overseas billing during this period is likely to go up by 3 per cent during the period, according to industry predictions.

The CII survey of the five southern states of Andhra Pradesh, Karnataka, Kerala, Puducherry and Tamil Nadu was carried out with the objective of analysing the performance of top five sectors in each of these states during April-September of financial year 2008. The aim was to provide an outlook for October 2008-March 2009 and to identify the issues and concerns for key sectors.

The survey captured the views of senior executives of leading companies in each of these five sectors. The top five sectors for the survey were identified on the basis of their contribution to the State gross domestic product (SGDP). The sectors surveyed in Karnataka included automobile and auto components, information technology, electronics, engineering and the steel industry.
 
Recently the Associated Chambers of Commerce and Industry of India (Assocham) had announced announced that layoffs would begin in the next 10 days across steel, cement, construction, real estate, aviation, ITenabled services and financial services sectors. (See: Companies may cut jobs by 25 per cent in ten days: Assocham)