Highly paid IT execs averse to job change
2nd, 3rd level leaders with over Rs1-cr salary reluctant to change jobs; Hiring activity likely to remain subdued for next 2 qtrs
image for illustrative purpose
- Large and mid-tier IT firms projected slow growth
- US and European markets remain tepid
- Big firms including Infy, HCL Tech guided for single digit top line growth
- Growth prospects for mid-tier IT firms are also bleak
Bengaluru: Senior leaders in the domestic IT services industry stay put in their positions, a sign of cautiousness amid tough times ahead. Industry officials of top hiring firms said hiring in the senior leadership position remained subdued as of now, which would continue in the coming quarters.
“Usually, we see hiring activity being the strongest in the management level when there is tremendous amount of growth happening. The second and third-level of leaderships are doing the work, which is not directly paid by the customer. So, they are not sure to move out in the current environment. Therefore, there is drop in hiring activity,” Aditya Narayan Mishra, CEO of CIEL HR Services, told Bizz Buzz.
For the quarter ended December, both large and mid-tier IT firms have projected a year a slow growth as economic activities key markets such as the US and Europe remain tepid. Among big firms, while Infosys has projected to grow its revenue in the range of 4-7 per cent in FY24, HCL Tech guided for 6-8 per cent growth in its top line. Growth prospects for mid-tier IT firms are likely to be grimmer than large firms during this period.
Against this backdrop, second and third level management positions which include presidents, vice-presidents, senior vice-presidents and others are sticking to their job positions than looking out for new roles. Interestingly, these are the leaders many of which figure as employees drawing more than Rs1 crore in the annual reports.
During the pandemic period, a lot of churns has been seen in these positions owing to robust demand environment.
While a lot of shuffling has happened in the CXO-level roles since the beginning of the year, movements in the second-rung leaders remain fairly subdued.
Meanwhile, attrition in the industry has come down significantly with employees on all levels not willing to change jobs due to lack of opportunities. TCS reported 120 basis decline in its attrition sequentially at 20.1 per cent in Q4 of FY23, while Infosys witnessed 340 basis points drop with attrition coming at 20.9 per cent. Similarly, HCL Tech saw its attrition coming down by 220 basis points at 19.5 per cent during the fourth quarter.
“Attrition continues to inch lower with companies sitting on bench (reserved employees). In this scenario, we don’t see much pick up in hiring for the next two quarters though recruitment continues for specific skillsets,” said Mishra.
Usually, we see hiring activity being the strongest in the management level when there is tremendous amount of growth happening. The second and third-level of leaderships are doing the work, which is not directly paid by the customer. So, they are not sure to move out in the current environment. Therefore, there is drop in hiring activity
- Aditya Narayan Mishra, CEO of CIEL HR Services, tells Bizz Buzz
