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TCS on track to hire 40,000 employees in FY23

Tata Consultancy Services is sticking to its hiring target of 40,000 for the current financial year as the company terms the demand environment to be steady despite fears of recession in the US economy. Announcing its first quarter results, the company said its hiring plan is on track.

TCS on track to hire 40,000 employees in FY23
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TCS on track to hire 40,000 employees in FY23

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Bengaluru, 9 July Tata Consultancy Services is sticking to its hiring target of 40,000 for the current financial year as the company terms the demand environment to be steady despite fears of recession in the US economy. Announcing its first quarter results, the company said its hiring plan is on track.

IT services attrition was at 19.7 per cent on the last twelve months' basis in Q1 of FY23 while it was at 17.4 per cent in the preceding quarter.

Rajesh Gopinathan, CEO and MD of TCS said attrition for the quarter should be seen from a seasonality perspective as many junior employees leave during this period for study and other avenues.

'Attrition has not yet started to dip. We expect this to continue into parts of second quarter also. In second half (H2), we will see some meaningful moderation. That is our short-term view on attrition. On medium to long-term, supply side should ease," Gopinathan said.

The company said that it was taking all kind of measures to check attrition.

"Following our annual compensation review, employees received salary increases of 5 to 8 per cent, with top performers getting even bigger hikes. Our empowering, performance-driven work culture is helping us attract local talent across all our key markets. Continued hiring momentum resulted in a milestone quarter, with the employee strength crossing the 600,000 mark," Milind Lakkad, Chief HR Officer, said. TCS' workforce stood at 606,331 with a net addition of 14,136 employees during the first quarter.

"We always have a good presence in tier-II centres. Also, when you see our National Qualifier Test, it has basically democratised it. We hire from all parts of India through this test," N Ganapathy Subramaniam, Chief Operating Officer of TCS said. The company also added that it would continue to drive its return to office mode with more employees coming to office every month.

The Mumbai-headquarter firm's operating margin was negatively impacted due to high attrition along with rise in travel costs.

"It has been a challenging quarter from a cost management perspective. Our Q1 operating margin of 23.1 per cent reflects the impact of our annual salary increase, the elevated cost of managing the talent churn and gradually normalizing travel expenses," Samir Seksaria, CFO of the company said.

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