This could be a temporary phenomenon as the top four IT companies have backfilled vacancies created by the great resignation
Barely a couple of days after market research companies predicted a near-term slowdown for the Indian IT companies over fears of inflationary headwinds and global recession, we now have HR experts weighing with their views on how the campus hiring may go in FY23. The consensus is that the top-four Indian IT companies may just take the pace off the talent hunt.
The top four IT companies had hired around 227,000 fresh graduates during FY22 and staffing companies believe that this number could reduce to 155,000 in the current financial year as TCS, Infosys, Wipro and HCL recalibrate their business strategies for the rest of the year following their Q1 earnings reports.
Why this make not make sense in the future
Interestingly enough, some of the HR professionals we spoke to believe that this reduction could be a wrong move, given that usually headwinds of an economic slowdown in the US and across Europe results in more offshoring opportunities to India. In fact, companies like Infosys and Wipro have articulated this trend while sharing their revenue numbers for April-June.
An executive working with a Bangalore-based staffing company thinks that it could be a knee jerk reaction to the reports of a possible recession, taken by HR managers of these companies without waiting for a clear directive from the top brass. “They need to pitch a number to the placement managers at colleges by March or April, by which time these companies hadn’t even factored in the impact of recession or worked through a quarter to see how things pan out.”
The last two years were aberrations
During the last quarter of the previous fiscal year, these companies had onboarded over one lakh employees, of which more than half were fresh graduates. Of course, this spurt in hiring was forced on them by the great resignation wave that saw many of their staffers with three to four years experience being whisked away by others with a substantive hike in salaries.
Of course, there was also the massive tailwind caused by the fast pace of digitization post the Covid-19 pandemic and the corrections brought forth by the pyramidical restructuring that saw tenured staff being replaced by cheaper ones. It was reported that TCS and Infosys actually hired twice the number of graduates from campuses last fiscal year.
In percentage terms, the hiring appeared huge also due to the fact that a year ago, the pandemic had forced these companies to virtually shut down new inductions. The top four IT companies had hired just 84,000 fresh hands during FY21 as they went whole hog to reduce expenses by freezing even promotions and increments.
The turnaround has been completed now with both attrition and utilization not favoring the IT companies any more. Companies would henceforth focus on enhancing utilization through a better deployment of freshers to ensure that the type of work likely to be offshored in the wake of the slowdown in the US is fulfilled at the lowest possible cost.