Indian IT Titans Scale Back Amid Economic Headwinds (Image Source: iStockphoto)
In the wake of a global slowdown in technology spending and uncertainties in demand, India’s leading information technology services companies witnessed a notable reduction in their workforce during the fiscal year ending March 31, 2024. Five out of the top six IT firms in the country reported a collective decrease of 73,600 employees, marking a significant departure from their historical trend of expansive hiring. HCLTech stood as the sole exception, recording a modest increase of 1,537 employees during the same period.
According to The Economic Times report, the downturn in employment figures reflects the challenges faced by the USD 254 billion Indian IT industry, which grappled with subdued business growth amid the aftermath of the pandemic. Factors such as economic slowdown, automation, restructuring efforts, and diminished discretionary spending collectively contributed to fewer job opportunities and reduced hiring initiatives across the sector.
According to Krishna Vij, business head for IT staffing at TeamLease Digita, the contraction in the workforce can be attributed to the excessive hiring spree witnessed during the COVID-19 boom period, coupled with ongoing industry contraction in demand. Notably, the top three IT giants—Tata Consultancy Services (TCS), Infosys, and Wipro—reported significant reductions in headcount, with TCS witnessing a decline of 13,249 employees, Infosys shedding 25,994 jobs, and Wipro recording a reduction of 24,516 employees.
Kumar Rakesh, associate director of equity research at BNP Paribas, highlighted a shift in focus among IT companies towards optimizing employee utilization rates, particularly after a period of heightened attrition and demand. This strategic shift resulted in headcount reductions across several firms, despite revenue growth observed during the fiscal year.
