Bangalore: Software companies in India hire over 60 per cent of fresh engineering graduates, and this trend may affect the growth of manufacturing sector and also the quality of teaching faculty in the long-term, according to a study by the Indian Institute of Technology-Bombay (IIT-B).

Students from all branches of engineering are being lured by software firms which offer high wages compared to the "old economy" sectors, said the initial findings of the study, based on placement data available with IIT-B since the early 1990s till date.

As many as 350 to 400 under graduates and 350 post graduates pass out of various engineering streams annually from IIT-B.

"We have taken IIT-B as a sample for IITs in general. The trend of majority of graduates moving to IT firms is common even in the Regional Engineering Colleges and other engineering colleges across the country," Anand Patwardhan, associate professor, Shailesh J Mehta School of Management, IIT-B, who conducted the study, said.

He said in the last three years nearly 75 per cent of M-Tech from IIT-B have got IT jobs.

"The IT job hiring pattern more or less meets the forecast by National Association of Software and Services Companies (NASSCOM) that the industry will have a one million workforce by 2005," the study said.

According to the All Indian Council of Technical Education (AICTE), around one and half lakh engineering graduates pass out of colleges every year.

"In the short-term, traditional employers of engineers may lose out on talent, but in the long-term, the education system would suffer, as the post graduates are the ones who take up teaching careers," Patwardhan said.

He said if the existing trend continues, local engineering colleges would be the worst affected due to lack of faculty. "Many of them are already struggling to find good teaching staff. It will only worsen."

One of the factors IT firms luring the youth is the high wage difference of up to five times than the traditional sector, he said.

Patwardhan said the study would be extended to cover RECs and local engineering colleges that would help in analysing the issue better and find possible solutions.

Yet, it is not all rosy for the IT industry. Pitfalls like burn out, lack of challenging assignments and retrenchment are some issues the students are concerned before taking up a software job, he said.

PTI