NEW DELHI: After a period of whirlwind expansion since the outbreak of the Coronavirus pandemic, Indian IT services companies are now hitting the pause button.
This comes at a time when five of the ten largest firms recorded a sequential decline in the sales and support staff in the September quarter, as they let go of non-revenue generating employees, thereby putting an unofficial hiring freeze, reports said.
According to a report published in LiveMint, the fourth and fifth largest IT services firm- Wipro and Tech Mahindra Ltd, reported a significant decline in the number of their sales, support staff, and software engineers, respectively, in the quarter that ended September.
L&T Technology Services Ltd, the smallest of the three IT firms under L&T, and Hyderabad-based Cyient Ltd, also ended with fewer sales staff in the quarter. The tenth largest IT firm, Zensar Ltd, also witnessed a sequential decline in the workforce. According to the report, this is the first significant reduction in headcount at any large IT firm since the first quarter of 2020.
Reports added that the pace of hiring was also the slowest in Q2 FY22 in the last two years for companies like Tata Consultancy Services Ltd, Infosys Ltd and HCL Technologies Ltd. As staff cost accounts for 55-65 per cent of total expenses at IT firms, some companies are now looking to slow down on hiring experienced professionals.