It’s “extremely hot” with opportunities
Amid increasing digital transformation deals and demand for talent, attrition rates at leading IT companies in India continue to rise. In companies such as Infosys, Wipro and L&T Infotech, attrition was 14-15% at the end of the first quarter of fiscal 2022.
Jyoti Roy, DVP-Equity Strategist, Angel Broking said Activity area that a major cause of this trend is the contraction of traditional services as the demand for digital services increases. Although companies try to retrain their employees, the demand will continue to outweigh the supply of talent.
“The Indian IT sector is in a phase of multi-year growth given the accelerated adoption of digital technologies for digital services due to the Covid 19 pandemic. Due to this phenomenon, there is a mismatch between the supply and the demand for digital skills, with the demand far exceeding the available talent pool. As a result, there has been an increase in attrition rates, ”Roy said.
The attrition rate at Wipro rose to 15.5% against 11% in September 2021, at Infosys to 13.9% against 7.8% and at L&T Infotech, it is up 15.2% against 13, 5%. TCS, however, managed to reduce the attrition rate marginally to 8.6 percent from 8.9 percent.
Sanjay Jalona, CEO and Managing Director of LTI said Activity area, “The market is extremely hot with opportunities, the attrition rate of everyone in the industry is high. Our attrition rate for the first quarter of fiscal 22 is 15.2%. It has increased slightly and will continue to increase over the next two or three quarters as demand will remain high. “
While Tata Consultancy Services crossed an overall workforce of 500,000 people worldwide this quarter, adding 20,409 employees in this quarter alone, its attrition rate fell from 7.2% in Q4FY21 to 8. , 6% at T1FY22.
Vahishta Unwalla, Chief Analyst – Industry Research, Care Ratings calls this a “usual way of doing business in the IT industry” because many early entrants left their jobs around this time to pursue higher education. “First-quarter attrition typically peaks because junior-level employees leave companies to pursue their education. In the same quarter of last year, attrition in the IT industry was low as the pandemic just started and people feared job losses, ”she said.
All companies have announced ambitious hiring plans for FY22. Infosys will add 35,000 new employees this fiscal year while Wipro will hire 9,000 on campus. Wipro also plans to roll out 30,000 letters of offer for on-campus hiring, which will join FY 23.
TCS added 40,000 last year and said it will add more this year.
LTI added 2,300 employees in the first quarter of fiscal 22 and has committed to add 4,500 new employees this year. Last year, they added 3,000 Freshers in total.
“We have a lot of confidence when we commit to these numbers because all of our assets are our employees. We will continue to be in the leader growth quadrant given our speed of exit and our deal pipeline, ”said Jalona.