Robust IT demand may take hiring spree into 2022
The new variant is likely to put some pressure on hiring by GCCs (Global Capability Centres) of global firms. We remain cautious on hiring prospects of GCCs given the current environment in the US and Europe, said Aditya Narayan Mishra, Director and CEO of CIEL HR Services
Strong demand environment expected to continue; May slowdown in H2 as employees begin to come back to office
Bengaluru: The hiring momentum seen in the technology industry this year is likely to sustain in 2022 as companies expect robust demand environment to continue. According to HR experts, the first half of next year is expected to have similar hiring momentum like this year when IT companies hired a record number of fresh engineering graduates. However, some slackness is likely in the second half as the companies get back their employees to offices.
As far as internet-powered startups are concerned, demand for tech talent is going to sustain in 2022 as fund raising environment remains benign. "Hiring momentum in the IT industry is likely to continue as demand environment remains robust. We don't see any deceleration in this trend. In the second half, when companies reopen with employees start working from offices in big numbers, we may see some decline in the pace. Otherwise, the demand for tech talent remains intact," Aditya Narayan Mishra, Director and CEO of CIEL HR Services, told Bizz Buzz.
"We also see that fund raising activity of internet-powered startups remains vibrant. Therefore, hiring pace is likely to continue in 2022," Mishra added. The demand of tech talent saw a decadal high in 2021 as IT companies added new clients at a brisk pace owing to the pandemic. Maturing startup ecosystem in India also chased the same pool of engineering talent, making it one of the best years in terms of hiring and salary hikes in recent times.
On the back of such talent, attrition shot up at a rapid pace and forced companies to hire in large numbers to overcome the supply side constraints. For the quarter ended September, many IT firms have witnessed more than 20 per cent attrition rate. Infosys saw its attrition rising by 620 basis points over the first quarter to 20.1 per cent. Similarly, Wipro's attrition rate reached 20.5 per cent in Q2 of FY22, up from 15.5 per cent in Q1.
For HCL Technologies, attrition rate touched an all-time high rate of 15.7 per cent, up from 11.8 per cent reported in the first quarter.
Indian IT companies are hiring aggressively to meet the high demand from clients and tide over these high attrition numbers. The top-4 IT services firms in India alone are planning to hire around 160,000 fresh graduates in the second half of this fiscal year. In addition to that, lateral hiring is also on a full swing. Apart from hiring, most IT firms have also rolled out many employee-friendly initiatives in recent quarters.
Meanwhile, the rising Covid infection in the US and Europe arising from the new variant is likely to put some pressure on hiring by GCCs (Global Capability Centres) of global firms. "We remain cautious on hiring prospects of GCCs given the current environment in the US and Europe," said Mishra.