In the most recent earnings season, the Indian IT industry produced disappointing figures, indicating a difficult time ahead for the sector due to severe macroeconomic conditions. The fall in hiring rates and net personnel addition across large corporations in FY 2022–23 is a result of the downturn in the IT sector.
All You Need to About The Hiring Details of IT Companies!
Tech Mahindra reported a net personnel addition of 1,227 in FY 23 compared to 30,119 in FY 22, a massive 95.93% decline. This information was included in the company’s earnings announcement from last week. A similar decline in Wipro’s hiring rates was noted. The company added 13,793 net new employees in FY23, which is approximately a third more than the 45,416 new employees added in FY22.
Business Today previously revealed that fewer people were hired at TCS, Infosys, and HCLTech in FY 23 YoY. Net personnel addition decreased by 78 percent at TCS, by 46 percent at Infosys, and by 57 percent at HCLTech. Industry insiders and analysts said that the decline in demand for IT services was the cause of the slowdown in hiring.
The present slowdown has undoubtedly affected employment and expansion, according to Kalyan Durairaj, director of HR at FourKites (APAC). The rise of personnel has slowed as a result of IT companies’ conservative hiring strategies due to the uncertain economic climate. The banking crisis that occurred in February and March of this year caused additional ramp-down in current transactions of IT companies and cutbacks in discretionary expenditure. The IT sector was already slowing down due to a drop in demand caused by macroeconomic conditions.
In an interview with Business Today, TCS Chief Operating Officer N. Ganapathy Subramaniam addressed this and said, “Towards the middle of February and March, the banking crisis hit which slowed down operations a little bit. Many of our clients thought it was time to exercise some caution.”
“During the quarter, we saw some ramp-downs that were unplanned and these were across different sectors. We observed some in the telecommunications industry, in technology, in retail, and in financial services.” CEO Salil Parekh said on the earnings call.
Major Indian IT companies’ management comments during the Q4 FY23 earnings period suggested that they would stick with this cautious hiring strategy for the foreseeable future. According to Ram Sundarajan, chief people officer of HCLTech, “The FY 24 hiring plan will be moderated on the back of the net additions that we have done in the last two quarters.”
Major Indian IT companies are also becoming concerned about the expanding bench size. Companies are concentrating on reskilling and upskilling their employees in areas where demand is higher in order to better utilize the bench.
During the earnings call, Tech Mahindra’s global chief people officer and head of marketing, Harshvendra Soin, stated, “In FY 23, our main focus was on upskilling. Upgrading our internal personnel and giving them opportunity remain our main priorities.” With the growing interest in AI, businesses are reducing headcount and exploring adopting automation to increase efficiency.
