That’s a 69% drop. The total addition for TCS, Infosys, Wipro, HCL and Tech Mahindra last year was slightly lower than even the addition in the Covid-hit year of 2020-21.
Infosys and TCS led the additions, with Infosys adding close to 30,000, and TCS adding 22,600. Tech Mahindra added the least, at 1,227.
The final quarter was particularly bad, with Tech Mahindra, Infosys and Wipro reporting declines in headcount. For Wipro, this was the second consecutive quarter of reduction in the employee count. In the December quarter, it reported a decline of 500.
All these firms have been facing headwinds. Clients are delaying decisions on tech investments, some are even cancelling projects. This, coupled with attrition moderating over the last few quarters, led firms to add fewer people.
The companies now have a good bench strength to deploy on projects, a lot of it due to the addition of freshers.
“A lot of them on the bench are getting skilled andare getting trained. So, we have quite a leeway for the next few quarters in terms of the availability of freshers,” Nilanjan Roy, CFO of Infosys, said at the earnings press conference. Including trainees, Infosys had a utilisation of only around 76. 9% in the final quarter of FY23.
Namratha Dharshan, chief business leader – India Research at technology research and advisory firm ISG, notes that during the period of good growth and high attrition, IT services providers were hiring two people for every person who left.
Now, with growth slowing, many are sitting idle. This explains why most of these companies are delaying onboarding of freshers who were given offers in the past few months. Hiring of laterals (those with experience) has dropped sharply.
“Companies have restricted employment to high-demand skills like AI, data science, and cybersecurity,” Dharshan says.
Hansa Iyengar, senior principal analyst at London-based IT advisory Omdia, says these companies are now hiring for specific skills especially onsite – in Europe and the US – because that’s what clients want. “This is replacing mass hiring. It makes sense to hire what is needed rather than hire in the hopes of future demand,” Iyengar says.
Following its latest earnings announcement, TCS said it is trying to develop its resources internally, by upskilling them, rather than looking out for talent in the market.