Major IT Firms Downsize with 75,000 Job Cuts, Fresh Graduates Affected

Employment levels at big Indian IT firms have fallen for the fourth consecutive quarter, owing to a cautious approach to new recruitment and a slow pace of replacing staff who leave. This tendency is against fluctuating demand in major markets, significantly reducing personnel numbers at the industry's leading companies.

The total employee count of the top eight IT businesses has fallen

The total employee count of the top eight IT businesses fell by 17,534 in the quarter ended 31 December, according to the Economic Times, citing statistics from Xpheno, a hiring firm. Year-on-year (YoY) figures show an even starker contrast, with Tata Consultancy Services, Infosys, Wipro, HCLTech, LTI Mindtree, L&T Technology Services, Tech Mahindra, and Cognizant's operations in India experiencing a collective reduction of 75,000 employees, the most significant decrease seen in over a decade. The employee base for these eight organisations has returned to levels seen in early 2022, with a headcount of just under 2 million.

The loss in workforce numbers began in the January-March quarter of 2023, with a reduction of 12,455 employees from the previous quarter, followed by a drop of 28,387 in the April-June quarter and another decrease of 16,624 through September.

Despite the current crisis, there are signs that the sector may soon witness a rebound

A technology-focused research firm stated that recent solid financial results by platform and cloud service providers could boost demand, perhaps leading to an increase in hiring—a rising trend of 100% offshore support for essential functions, pushing demand for entry-level positions. However, the recruitment strategy has been conservative due to earlier overenthusiastic hiring in expectation of demand, which has subsided. Some organisations have even postponed onboarding graduates who were recruited through campus placements to protect profits, with hires from 2022 still awaiting their start dates.

Impact on Fresh Graduates:

• Many companies are delaying or freezing new graduates' onboarding due to the current uncertainty.
• This leaves thousands of graduates who had secured job offers in a state of limbo and anxiety.
• Some companies offer alternative options like internships or extended training periods while waiting for hiring to resume.

Specific numbers of job cuts at individual companies are not always publicly available. The impact on fresh graduates might vary depending on specific company policies and sectors within the IT industry. It's essential to stay updated with industry news and trends to navigate the job market effectively.