Hiring in IT services may gather pace only by December quarter

  • In Q1FY21, the net addition of employees at the top IT firms was lowest in years as lateral hiring was deferred
  • Demand over the next few months will be driven by captive businesses in the healthcare and telecom sectors

Bucking the trend, hiring of software professionals this year is expected to gain momentum only by the fiscal third quarter, considered a seasonally weak quarter for the sector, as recruitments have been deferred due to the coronavirus pandemic.

“Typically, the peak of hiring is during the first two quarters (April-September) and the third quarter is seasonally slow. But, this year, we expect hiring to pick up in Q3 as many of the projects got deferred and we can also expect tapering of the pandemic from there on after peaking in August,” said Sanju Ballurkar, president at Experis, the IT recruitment arm of ManpowerGroup India.

Demand over the next few months will be driven by captive businesses in the healthcare and telecom sectors as they have seen increased momentum throughout the pandemic, said Ballurkar. “IT services firms will continue to account for mass hiring, though.”

In Q1FY21, the net addition of employees at top IT companies was the lowest in several years as most of the lateral hiring and new joining were deferred. While at Tata Consultancy Services (TCS) Ltd, the headcount declined by 4,788 employees, at Infosys Ltd and Wipro Ltd, it dropped by 3,138 and 1,082 respectively on a sequential basis.

The US government’s temporary ban on H-1B visas will also lead to an uptick in hiring by either global in-house centres (GICs) or captives in India as they will need to fill the void created by the lack of onshore talent. “The lack of visas and tougher immigration rules will prompt more people being hired in India. Captives are also expected to show enhanced hiring trends in India as more outsourcing happens,” said Lohit Bhatia, president, Indian Staffing Federation.

Most of the large enterprises in the banking and retail segments have embarked on digital transformation at some level, and consequently, skills in the digital space will continue to witness greater demand.

IT hiring in the digital space will rise in a post-pandemic world as “digital solutions have seamlessly dovetailed into the overall business strategy of organizations to ensure better adaptability to the new normal”, said Ramesh Alluri Reddy, director (managed services & professional staffing), Adecco India. “Q3 will see a good amount of revival across IT services,” he added

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