The Indian IT sector is set to witness attrition of more than 1.15 million this fiscal according to Xpheno, a specialist staffing firm.
Attrition in a company refers to employees that voluntarily quit. “With an average of 23% attrition projected on a talent base of 5 million, the tech sector is set to witness over 1 million talent movements this year,” said Kamal Karanth, CoFounder, Xpheno.
“The hiring action around attrition refills combining with the expansion hiring for the year, has set the pace for talent movements,” he added. Interestingly, overall attrition in the sector has not changed in the last four years, but its status shifted from `highly involuntary’ until a year earlier to `highly voluntary’ in the current fiscal, industry experts said.
For instance, the tech industry, due to a slowing market, witnessed overall attrition (involuntarily) in the range of 21.3% to 22% in the last three years. In FY22, driven by overall buoyancy in the job market and recovery of economic activities, attrition (voluntary) is projected to be in the range of 22% to 23%, according to them.
“While attrition rates for FY20 and FY21 and expected attrition levels for FY22 are largely the same. The difference is the shift from involuntary attrition to voluntary attrition. The onset of the pandemic triggered a wave of involuntary attrition with enterprises shedding benches and cutting down on flab in response to the market lockdown,” pointed out Mr. Karanth.
The work-from-home (WFH) regime also made job hunting easy for technology professionals. Exploring multiple career prospects outside the current employer has become extremely easy for job seekers with every part of the recruitment process going virtual in the pandemic-triggered work-from-home economy, said B.S Murthy, CEO, Leadership Capital, a tech hiring and advisory firm.
“Today, techies are able to engage with 10 or 15 prospective employers simultaneously, compared to 2 or 3 firms in the pre-pandemic time. Sitting at home, they take several job interviews, complete the recruitment process and collect offer letters. The new work culture is a real blessing for most talent in terms of convenience for job hunting,” he added.
Demand for skilled talent has gone up by 40 to 50% in the tech industry and this, in turn, is leading to a talent war, according to TeamLease Digital.
“Some enterprises are trying to retain talent by increasing pay and perks while others are partnering with staffing firms,” said Siva Prasad Nanduri, vice president and business head, IT and staffing, TeamLease Digital.
Attrition in IT landscape
Currently, funded technology start-ups are seeing the highest level of attrition at 30% whereas IT product firms are seeing only half of that. Domestic IT services providers and large consulting firms are witnessing a 25% attrition while GICs/captives and non-IT enterprises are reporting an overall tech talent attrition of 20%, according to data from Xpheno.
