IT firms to cut campus hiring: Nasscom1 min read . Updated: 24 Jul 2013, 12:57 AM IST
Nasscom president Som Mittal warns that colleges will have to find a way to differentiate themselves to attract companies
Software services companies in India will hire fewer graduates from colleges compared with last year as the business environment has become unpredictable and the number of employees quitting their jobs has dropped, according to the industry’s apex lobby group.
Companies such as Infosys Ltd, Tata Consultancy Services Ltd and Wipro Ltd are expected to reduce the number of people they hire from colleges to 40% of their total annual recruitment compared with 60-70% earlier.
“With the hiring pattern changed, we would have only about 40% of hiring from campuses and the rest will be lateral hires and just-in-time hiring so that we can forecast the attrition and business better," said Som Mittal, president, Nasscom, in a human resources summit on Tuesday. “The business is so uncertain that we don’t want to give a large number of offers and extend their stay."
The number of engineers graduating in 2013 is estimated to triple to 1.3 million from 365,000 in 2005. India’s top 10 software services exporters will hire only around 150,000 engineers this year. They had hired 200,000 last year and about 400,000 in 2006-2007, when demand was much higher.
“The gap between the number of graduates available to those being hired will only widen next year as companies are getting more comfortable with just-in-time hiring as supply is a lot easier now," said an analyst, who requested anonymity.
Mittal warned that colleges will have to find a way to differentiate themselves, as companies are now focusing more on recruiting people with more domain and soft skills rather than just technical skills.
For next year’s job offers, campus hiring will be split between September and March and another phase between May and July.
Another reason for software services companies hiring fewer people is that attrition levels have narrowed to 14% in FY13 from 19% in FY11. The number of employees quitting their first jobs is also at a record low.
Campus hiring is likely to continue to remain low for at least the next 12-18 months, after which demand is expected to revive, the analyst said.
Mittal maintained the export growth rate forecast of 12-14% for the IT industry this fiscal year but said Nasscom will look to revise it in October if there is any change in the business environment.