Leading IT services majors TCS, Infosys and HCLTech’s net employee addition has shrunk by more than 16,000 during the July-September quarter of the ongoing financial year amid continuing macroeconomic headwinds forcing a reduction in their growth forecasts for FY24.

According to the results declared for the second quarter, the three companies together have an employee base of 1.15 million at the end of September 2023 compared to 1.17 million three months ago.

India’s second largest IT services provider Infosys reported the sharpest decline in net employee base at 7,530 people during the quarter. Mumbai-headquartered TCS saw a reduction of 6,333 employees, while Noida-headquartered HCLTech reported a decrease of 2,299 employees.

All three IT giants also saw their voluntary attrition levels moderating to around 14 per cent—a contrast to the 20 per cent-plus attrition witnessed two years ago at the peak of the tech talent war. The opening up of plethora of tech opportunities in the wake of pandemic-led digitisation of organisations saw tech employees negotiating multiple job offers and exorbitant joining hikes. And tech organisations witnessed high offer dropout rates.

Now, however, the scenario has changed considerably as the IT majors have cut revenue growth forecasts for the ongoing financial year. Infosys cut its revenue guidance for 2023-24 to 1-2.5 per cent compared to the 1-3.5 per cent given earlier. HCLTech has reduced revenue growth guidance for the full year in the range of 5-6 per cent from 6-8 per cent projected at the end of June 2023 quarter due to its below-expectation performance during the first half of the current fiscal.

Pointing to a significant fresher bench that is being trained on Gen AI, Infosys CFO Nilanjan Roy said the company is not looking to make fresh campus hires yet this year.

HCL Tech CEO & MD C Vijaykumar said in the earnings call that the recruitment part has reduced because they hired many freshers. The Noida firm, which added 3,630 freshers during the quarter, said it plans to hire 10,000 freshers this year compared to around 27,000 freshers it recruited in 2022-23.

On the people front, TCS CEO N Krithivasan had said in an analyst call after Q2 result declaration: “We continue to have the right talent, but have recalibrated our gross hiring to ensure better utilisation of our existing capacity.” The firm’s CHRO Milind Lakkad pointed out that they invested in fresh talent for the past 18 months. “That investment is now paying off. And as a result, and also because of lower attrition, we kind of recalibrated our gross hiring and those numbers are less than our attrition. And hence, there’s a net reduction.”