IT hiring is yet to be out of woods
The second-quarter result of top Indian IT services companies is indicative of demand revival. It also gives a positive signal as far as hiring trend is concerned. After the combined headcount of the top four IT services companies - Tata Consultancy Services, Infosys, Wipro, and HCL Technologies - declined by 9,000 in the first quarter (April-June period) of this fiscal year, it increased by 17,079 in the second quarter (July-September). Such addition, while brings good news for the industry, only says half the story. Delving into the numbers reflect that a full-scale revival in hiring is still some time away. Because the combined addition comprised lateral hires, fresh graduates, and rebadged employees. The hiring number for September 2019 is also a case in point. In the quarter ended September 2019, the total employee addition stood at 31,380 as compared to 17,079 this financial year.
However, most Indian IT firms have resumed lateral hiring, in which these companies take experienced people. The new employees were onboarded through the use of digital means. Similarly, some employee addition was due to rebadging of client staffers. Typically, when a vendor or IT firm takes over a certain project from the client, the employees working on the project also comes to the pay rolls of the IT services company. As some large deals given by the clients come up with the conditions of taking over employees, some portion of employee addition during the second quarter is due to this trend.
Apart from these two sections of people, fresh graduates remain the most crucial part of new hires. Unfortunately, this has taken a backseat due to the ongoing Covid-19 pandemic. While many IT firms have started onboarding freshers, many are not able to do so. The reason for this being non-completion of final exams amid social distancing restrictions, in many engineering colleges.
Despite this mixed hiring trend, the addition of new staffers is going to gather steam from the fourth quarter onwards. Demand revival in many sectors is seen as the major reason behind this optimism.
If the Covid vaccine becomes widely available, this trend will get a further fillip as aviation, travel, and hospitality, and other segments related to the services sector start to operate normally. Though automation and the emergence of digital technologies such as artificial intelligence, machine learning, big data, and the internet of things have begun to reduce dependence on human resources, still new-age jobs are getting created with the requirement of different skillsets. As the globe is on the verge of getting a remedy for the Covid pandemic, the hiring trend is likely to pick up in the coming months.