Attrition drops at IT firms

Attrition has lately become less of a headache for HR managers at the IT companies as jobs in the sector lose their sheen in the wake of a slump in the business of outsourcing.

Attrition has lately become less of a headache for human resources (HR) managers at the information technology companies as jobs in the sector lose their sheen in the wake of a slump in the business of outsourcing.

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The United States, the biggest source of outsourcing orders for Indian IT companies, has been hit by a financial crisis
that slowed its economy and forced its companies to cut back on spending, including those on IT. As a result, IT companies back home are looking to protect their margins by going slow on hiring and salary hikes.

They are also changing their hiring mix in favour of fresh graduates. That means few jobs for lateral hires and consequently a drop in people changing jobs within the industry.

“Our attrition levels have reduced from 13.9 last year to 13.6 this year as hiring has slowed down across laterals and people are watching a wait and watch strategy,” said Nandita Gurjar, HR head, Infosys Technologies. “A slowdown is something an HR person would love.”

The attrition rate at Infosys BPO was about 35 per cent last year and has reduced to about 28 per cent this year.
SV Krishnan, the global HR head, Satyam Computer Services Ltd, said the attrition was about 12.5 per cent last year is bound to be lower this year, as hiring slows down across the industry.

Satyam Computers hired about 16,000 people last year of which about 35 per cent were campus recruits. But this year, it plans to hire much less, about 10,000, of which fresh graduate will account for 45 per cent, Krishnan said.

Infosys plans to add about 25,000 people this year, down from about 35,000 that it had planned last year. About 18,000 of the total hires would be campus recruits, while the remaining will be laterals or direct hires.

Tata Consultancy Services will be adding about 30,000-35,000 people in 2008-2009 and plans to reverse its hiring mix. “At least 60 per cent of our recruitment would be trainees and this will help us optimise our talent acquisition cost,” said Ajoyendra Mukherjee, HR head, TCS.