The attrition rate of leading IT firms in India is now at an all-time high. As a result, the tech biggies are facing issues in executing projects. After the low attrition rates last year in the wake of the pandemic-induced slowdown, the IT job market is picking up pace again. Employees were already seeing 50 to 70 percent hikes in April this year, and the demand has been soaring ever since.
The attrition rate of Cognizant is at 21% for the Jan to March quarter of 2021, in contrast to 19% in the same quarter last year. Infosys has recorded an attrition rate of 15.2%, and Wipro’s attrition rate stood at 12.1% in the fourth quarter. Meanwhile, the attrition rates of analytics professionals in India stood at 16.0% in 2020, dropping from 30.7% in 2019.
Also read: Analytics India Attrition Study 2021
Industry analysts anticipate a 22-23% attrition rate in 2021, which works out to one million resignations on a projected base of 4.6 million IT employees.
Changing business models
Earlier, Infosys Chief Operating Officer Pravin Rao said the high attrition reflects the strong demand environment. IT companies have seen improved bottom lines since the December quarter as workforces have shifted online, he added.
With the onset of the pandemic, Indian IT companies are now seeking to build newer business models based on user data and transactions to grow business.The new models have led to an increase in the demand for professionals trained and equipped to work on such projects. Cloud engineers, data scientists, cybersecurity officials, experts in artificial intelligence, machine learning, cloud computing, big data and automation are in high demand. The industry has seen an almost 30-35 percent growth in the recruitment of these skills this year.
Kamal Kamath, the co-founder of Xpheno, told Economic times, the job market would be buoyant for talent fuelled by the organic growth, increased IT spend and inflow of large-scale projects.
Echoing similar sentiments, Deepak Agrawal, CEO of TurboHire, said, with many IT transformation projects up for grabs, companies are expanding their workforce and are ready to offer higher salaries. The opening up of the market leads to higher attrition as more jobs become available.
The job market is exploding with new companies and startups willing to pay competitive packages. Smaller companies are in the market for the best talents. And it’s advantage, employees.
The data science job figures for June 2021 witnessed a 47.1% uptick in open jobs compared to the same period last year (June 2020).
India has observed a 45% increase in AI adoption rate, according to a PwC report. The report also stated that almost 94% of organisations in India now had an optimistic approach towards AI in terms of creating more opportunities. Forward-looking IT companies are ramping up their digital capabilities to keep up with the times, leading to an increased demand for analytics professionals. Counterintuitive as it might seem, high attrition rates points to the maturing of Indian IT industry.
With the onset of the pandemic, data generation saw an upsurge across sectors with everything going online. Companies are now heavily investing in data science and complex algorithms to mine the snowballing data to drive business outcomes. The network effect has kicked in, pushing the industry forward. Lot of downstream businesses have also opened up. Indian workforce are also turning online to upskill themselves. The right data skillset is a gateway to a highly rewarding career. Though the workforce is catching up in terms of skills, we are still falling short of bridging the supply demand gap.