NEW DELHI: Jobs are back in IT! The $167 billion industry, which was singing a dirge on rampant job cuts, irregular hiring patterns and reneging job offers made at campuses until a year ago, have risen like a phoenix from the ashes. Data collated from the top four IT companies reveal that there has been a five-fold increase in hiring during the first nine months of the current financial year as compared with the overall hiring made in 2017-2018.
IT majors such as Tata Consultancy Services, Infosys, Wipro and HCL have together hired more than 70,000 people, with TCS leading the pack adding 22,931 employees in the nine months to December 2018, followed by rival Infosys adding 21,398 people, Wipro (12,456) and HCL (12,247).
Analysts say that this surge could be to stabilise the business following strong attrition through the past year amid rising tide of newer technologies, pressure on traditional businesses and growing protectionism in their main markets. Thanks to the inflow of large deals and with new digital opportunities picking up, the IT majors are once again ramping up their operations. Besides hiring afresh, they have also begun to spend on upskilling employees.
According to Rituparna Chakraborty, co-founder of hiring firm TeamLease Services, tier 2 and tier 3 cities, will benefit from this demand, as these cities have a strong talent pool. Salaries are projected to rise by 10-13 per cent in 2019, and the highest paid technology areas are going to be big data analytics, machine learning and Artificial Intelligence developers, she observed. The IT staffing industry is pegged to grow at 14-16 per cent per annum and garner $5.3 billion by 2021, contributing to the new age of technology.
While this is good news for IT professionals as it comes in the backdrop of a major lay-off season in last two years, it is not exactly so for the companies as it continues to hurt their margins. TCS, which secured deals worth $5.9 billion during the December quarter, said it has hired more employees to meet that demand which weighed on the margin. “We’ve been adding people. The costs primarily are higher because of the people cost,” said V Ramakrishan, chief financial officer, said. TCS’ margin stood at 25.6 per cent in the December quarter. That’s below the guided range of 26-28 per cent and also the biggest sequential decline since April-June 2017-18.
The surge in hiring by IT firms could be to stabilise business following strong attrition, say analysts
Besides hiring afresh, firms have also begun upskilling staff
However, it continues to hurt companies’ margins