IT Hiring Likely To Be Cut By 20% In Next Financial Year 2023-24, Says Report

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posted on 2 years ago — updated on 1 second ago

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IT companies have already slowed hiring and the onboarding process due to the looming fears of a recession

After a hiring boom in the software services sector during the pandemic, companies are likely to cut campus and entry-level hiring by as much as 20 per cent in the next financial year 2023-24, according to a livemint report. It added that the IT companies have already slowed hiring and the onboarding process due to the looming fears of a recession.

Indian technology companies are already facing a high attrition rate and narrowing margins. In the June 2022 quarter, TCS’ attrition rate stood at 19.7 per cent on a last twelve-month basis. It was its highest attrition rate in the last six quarters. The rate came during the quarter ended March 2022 at 17.4 per cent. The attrition rate of Wipro was as high as 23.3 per cent in the June 2022 quarter, which was lower on a quarter-on-quarter basis. Wipro had posted a 23.8 per cent attrition rate in Q4FY22.

HCL Tech also posted a high attrition rate of 23.8 per cent, compared to the quarter ended March 2022, where the same was 21.9 per cent. On a year on year basis, HCL Tech attrition level has risen by 12 per cent from 11.8 per cent in Q1FY22 to 23.8 per cent in Q1FY23.

According to media reports, major IT companies, Infosys, Wipro and Tech Mahindra, have also revoked the offer letters it extended to students after the companies are delaying the onboarding process for months. The students, according to the report, said they have not been given any grounds for rejection.

Infosys is expected to hire 50,000 people from college campuses during the current financial year. TCS and Wipro might also hire 40,000 and 30,000 persons, respectively. Tech Mahindra is expected to recruit 15,000 persons and HCL Technologies might bring onboard 45,000, according to the livemint report.

“In FY22, about 470,000 employees were onboarded in the IT and IT-enabled services sector. In FY23, we estimate 350,000-370,000, but in FY24, if the recession continues, the numbers will drop. But at best, it will be similar to FY23,” said the report quoting Saran Balasundaram, founder of the tech recruitment firm, HanDigital.

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