Hiring at Infosys and Tech Mahindra is down at least 40% in line with the trend in top five IT firms— and it's not just because of COVID-19
- New hires at Tech Mahindra and Infosys has fallen by over 40% this year as compared to last year.
- Amid India’s top five IT giants, there have been 27% fewer new hires this year on average.
- The impact on hiring is largely due to automation and shift in business models than the coronavirus pandemic.
Overall, India’s top five IT companies — including Tata Consultancy Services (TCS) and HCL Technologies — added 66,500 employees in the last financial year as compared to 87,060 in the previous year.
Source: Respective company's earnings reports
|Company||Employees added in 2018-19||Employees added in 2019-20||Dip in hiring|
Why have new hires taken a dip?
Experts opine that the fall in job creation isn’t due to the coronavirus pandemic, which only reared its head in the last week of March, but due to the overall shift in how India’s IT giants are operating.
Harshvendra Soin, the Chief People Officer at Tech Mahindra, told ET that new-age technologies like artificial intelligence (AI) and automation are enabling delivery models which are no longer linear to the number of people. He explains that reduction in the requirement for certain employees is because mundane tasks have been automated and the ones that remain can now focus on solving business problems.
Tata Consultancy Services (TCS) is also looking to shift to a 25/25 operating model by 2025, wherein only 25% of its employees will be required to be in the office at a time and only spend 25% of their time physically at their desk as work from home becomes the ‘new normal’.
Infosys and Tech Mahindra, which saw the biggest drop in new hires, have reported higher attrition rates hitting nearly 20%. “We will hire only on a need basis and any incremental hiring will be only from a skill perspective,” said Infosys Cheif Human Resources Officer (CHRO) Pravin Rao during the fourth-quarter earnings call.
While this may be good news for IT companies since it means they can serve the same demand with fewer employees, the result doesn’t bode well for India’s unemployed and the number is increasing by the day. The country needs to generate at least 10 million new jobs a year in order to utilise its demographic dividend.
The companies have promised to honour any campus hire they have made this year, however, onboarding them may be a little slower with the nationwide lockdown in place.
TCS, Cognizant, Capgemini and other top giants who are not letting go of their new hires
HCL Tech follows TCS and Infosys' lead — says 50% of its employees will work from home even after the lockdown is lifted
TCS CEO says the business model is 20 years old — hinting that it may be time to go employee-lite
Popular on BI
- Midcaps Bajaj Electricals, IRCTC and Hatsun Agro have surged more than 40% in a span of 30 days
- Influencer marketing will be Rs 900 crore market in India by the end of 2021: Report
- Smaller crypto exchanges in South Korea will be closing their doors in the next 24 hours
- Powered by Unacademy and upGrad’s mega deals, Indian startups raised $10.8 billion in the last two months
- TVS Eurogrip denies speculation over signing a Rs 23 crore sponsorship deal with Chennai Super Kings