 "Hiring in the Indian IT sector shrinks for the first time in 25 years")
Amid spending cuts by Western countries and geopolitical risks, the hiring by nine out of 10 Indian IT companies fell in the July-September quarter, Mint reported on Monday. It is the first time the hiring in this sector, considered to be key in the country's economic growth, has shrunk in over 25 years.
The Mint report added that the year ending on March 31, 2024, may become the first time IT firms end up with fewer employees than at the beginning of the financial year. The workforce in the top 10 companies fell to 2.06 million at the end of the July-September quarter. At the beginning of the quarter, these companies had a workforce of 2.11 million people.
Only L&T Technology Services has seen a growth in their headcount. In the quarter, it added 32 people in the company, taking the headcount to an all-time-high of 22,265. All the other companies, including Tata Consultancy Services, Infosys, HCL, Wipro, Tech Mahindra and Persistent, saw a fall in their headcount. The total job losses come up to 51,744.
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"This is not correct that we are not hiring," an executive at Infosys was quoted as saying in the report. "But we are not hiring in numbers that can offset the number of people who move out of the company as part of natural attrition. So one can say the workforce could be less (at the end of the year) than what we started with."
Sunil Chemmankotil, chief executive of staffing firm TeamLease Digital, was also quoted as saying, "These are testing times for the IT behemoths."
"Changing deal types, pressure on margins, and looming uncertainty leave very few options for them when it comes to the talent strategy. It's going to be definitely a lower headcount (at the end of the year) than where we started this year. Maybe, it's time to consider newer talent options like staffing and gigs along with the latest productivity-increasing technologies," added Chemmakotil.
Most companies have also cut their revenue projection for the upcoming quarters.