TOP IT FIRMS IN INDIA FACE HIGH REDUCTION IN STAFF NUMBER - 'EMPLOYEE ATTRITION', & 'STRATEGIES' OF COMPANIES DETAILED!

After the recent quarterly results disclosures, the country's top four software firms have seen their headcount reduced by a net 9,100 employees between April and June quarter. The top firms who are on this list are; Tata Consultancy Services (TCS), Infosys, HCL Technologies and Wipro.

Surprisingly, this reduction in employees is likely to continue throughout 2020, as per analysts. Last year during the same time, all the four top companies had hired 22,622 people; who were expecting faster growth from clients in the US and Europe.

Meanwhile, experts in this field state that IT firms will further prefer people with specialised skill sets, while hiring freshers could be made more stringent to ensure intake of better-quality candidates. 

As per ET Telecom.com reports, TCS, Infosys, HCL Technologies and Wipro, account for over one-third of India’s software exports of $147 billion and employ more than a million professionals, which is a fourth of the country’s total IT workforce. Amid these times, the hiring firms said the trend will continue on the back of an increased push towards performance-based exits. 

“We expect to see similar trends over the next three quarters this year,” said Kamal Karanth, cofounder of Xpheno, a specialist staffing firm.

Aditya Mishra, the chief executive of CIEL HR Services, said there could be three trends in hiring and reduction of headcount across IT services companies in the year ahead. "Performance-based review and reduction in bench strength will continue and will overtake that of last year as companies look for more levers to strengthen margins," he said.

“The people manager roles will be under risk, administrative jobs will reduce. Secondly, talent with latest technology experience will get hired – those skilled in Augmented Reality, Mixed Reality, Computer Vision. The hiring process for freshers will be strengthened further. There will be an even more stringent assessment of the quality of candidates. They will also strengthen their assessment of candidates during the training process,” he added.

However, the key market for Indian IT services firms, will be linked towards digital skills, combined with increased pressure from work automation across industries, which will take place mainly in the United States. 

Media reports also state that the top four IT firms have indicated as high growth has returned as global clients spend more on technology to survive or reinvent businesses amid the pandemic. The firms will also look to outsource more work to cut costs which is expected to result in an increase in headcount. 

“The net attrition that you see is the attrition that's happening, typically, which will get backfilled. It is not getting backfilled and that is the reduction. But you will see that reducing or even changing next quarter with the trainee onboarding... we are also restarting lateral hiring," TCS CEO Rajesh Gopinathan told ET in a recent interview. Meanwhile, TCS plans to hire over 40,000 by 2020 end.