Updates from : DH News Service..
The fear of job losses is slowly becoming a reality as two of the top five IT firms based in Bengaluru reduced their headcount by 1% in the first six months of the current financial year.
Hit by the slowdown in spends across the world, India’s second and third largest IT companies — Infosys and Wipro — have downsized their workforce by 3,646 engineers between April and September this year. While Wipro saw a sudden headcount decline of 1.82% in the second quarter, the decline at Infosys has been more gradual.
Infosys has laid off 1,924 employees during the six-month period, while Wipro has seen a net reduction of 1,722, according to data provided by the companies in their regulatory filings.
The two giants employed a total of 3,65,845 at the beginning of the financial year in April, and the number came down to 3,62,199 by the end of September.
M D Ranganath, chief finance officer, Infosys, justified the layoffs, saying per-employee efficiency had gone up by 2.53% in the period.
The revenue per employee has gone up from $51,400 for the quarter ended March 31, to $52,700 for the quarter ended September 30, he said.
“If you look at H1 this year, as compared to the same period last year, our headcount has reduced by 0.7%, while revenue grew by 5.7%. This is part of the higher utilisation and efficiency in productivity,” he said.
Vishal Sikka, former CEO and MD, who made an unceremonious exit from Infosys in August, had set a target of $80,000 revenue per employee by 2020.
During the second quarter this year, Wipro reduced its headcount by 3,031, to 1,63,759 employees. It had, in fact, increased its headcount in the first quarter by 1,309 employees.
Infosys has seen a decline of 0.96% in employee numbers, spanning two quarters. In the first quarter this year, the company saw its headcount coming down by 1,811, from 2,00,364 to 1,98,553.
Continuing with the trend in the second quarter, the company saw its numbers declining by 113 to 1,98,440.
‘Trend will continue’
Kris Lakshmikanth, founder and chairman of Head Hunters India, expects the trend to continue for two years as the revenues of the companies don’t justify their headcount.
“I believe more layoffs will happen in the IT-enabled services segment than in IT as it is more prone to automation. Unfortunately, these companies don’t provide segregated numbers for IT and ITeS,” he said.
TCS on upswing
In contrast, TCS, the country’s largest IT services provider, has seen an addition of 1,990 employees, from 3,87,223 at the beginning of the year to 3,89,213 as on September 30.
The company had, however, reduced its headcount in the first quarter by 1,414 employees.
The country’s fourth largest IT company, HCL, has seen the highest growth of 2.64% in its headcount. The company has increased its headcount in six months by 3,067, from 1,15,973 to 1,19,040.
Incidentally, HCL has seen growth of a little over 7% in the two quarters, and is way ahead of its rivals in the industry.
The company’s revenues for the second quarter stood at Rs 11,519 crore.