Infosys, TCS Headcount Continues To Erode Even As Attrition Moderates
That’s bad news for India's engineering graduates, especially since Infosys has skipped campus hiring this year and TCS has stuck to its fresher hiring goal of 40,000.
The employee base of India’s two largest IT services firms continued to erode in the third quarter of the fiscal, even as attrition rates eased.
Headcount of Tata Consultancy Services Ltd. reduced by 5,680 employees to 6,03,305 in the October-December period, according to financial statements released on Thursday. It had dipped by 6,333 in the July-September quarter. In the nine months ended Dec. 31, TCS has seen its headcount reduced by a net 11,490 employees.
That, when attrition has reduced meaningfully over the same time period.
As on Dec. 31, voluntary attrition at India’s largest private employer stood at 13.3% on a trailing 12-month basis, as against 20.1% at the end of fiscal 2023.
The story is similar at Infosys Ltd. Headcount of India’s second largest IT services company reduced by a net 6,101 employees to 3,22,663 in the quarter ended Dec. 31, according to its financial statement released on Thursday. That’s the third straight quarter of decline: Infosys’ employee base reduced by 7,530 in the second quarter and 6,940 in the first quarter.
That’s bad news for engineering graduates, especially since Infosys skipped campus hiring this year and TCS stuck to its target of onboarding just 40,000 freshers in fiscal 2024.
India’s $250-billion outsourcing industry shed more workers in the July-September 2023 quarter than in any comparable period in the past five years, according to Bloomberg. Fresher hiring, too, is set to halve in the ongoing fiscal as outsourcers skipped campus hiring—a first since at least the global financial crisis.
“The figures show that there will be about a 40-50% drop in hiring of freshers in FY24. This means that roughly half a lakh fresher jobs will be impacted,” Sunil Chemmankotil, CEO of TeamLease Digital Ltd., had told NDTV Profit earlier.
“It has been a trend that top IT firms hired freshers in large volumes year-on-year and spent time and resources on training them. But in FY24, it is expected that most firms are upskilling their current workforce and cutting down their hiring rates for new talent significantly.”
Every year, India produces about 65 lakh graduates but only about 44% are employable for tech jobs, according to Teamlease Digital. About 65% of India’s Science, Technology, Engineering and Mathematics, or STEM, graduates need to upskill themselves for entry-level jobs. Even in the mid-to-senior level, 52% need upskilling to remain relevant and competitive.
