IT firms may need to up hiring to retain edge as GCCs come fishing
Despite the uncertain environment, IT services companies may need to step up hiring in the long term to protect against talent drain to global capability centres (GCCs), said experts.
The growth of GCCs has driven
IT services attrition rates
to as high as 16%. In 2024, greenfield GCCs hired about 110,000 people, a sharp increase from 60,000 in the previous year. Nearly 53% of these recruits were from IT services companies, data from Xpheno showed.
GCCs hired nearly 10 times more talent than Indian IT majors in 2024-25, according to Quess, causing 20-25% lateral movement. Around 40% of IT firms are adopting remote and hybrid work models to tap into talent from tier-2 cities and overseas markets, TeamLease said.
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"IT services firms have no choice but to refill these attrited resources because they are billable and directly impact revenues," said Kamal Karanth, cofounder of Xpheno.
"While lateral hiring is costly, companies are increasingly leaning on freshers, even though they take time to become billable." This explains why
Tata Consultancy Services
(TCS) may have remained committed to hire 40,000 freshers in this fiscal, while
Infosys
has set the target at 20,000. However, they will look to decrease their subcontractor costs, which have already declined 11% over the past eight quarters, according to experts.
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Chief human resources officer Milind Lakkad said TCS onboarded 42,000 graduates in 2024-25, a notch higher than the targeted 40,000. "And FY26 number will be similar or little higher," he said. "We expect our overall (fresher hiring) numbers (in FY26) to be significantly higher than what we did in FY25," said Ramachandran Sundararajan, chief people officer, HCLTech, adding that the company seeks to add about 2,000-3,000 freshers each quarter. It added 7,000 freshers in 2024-25.
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Meanwhile,
Wipro
which increased fresher intake by 10,000 last fiscal, said it will keep a close watch on the macro and business environment before committing to increased recruitment.
"We don't want a situation where we onboard people and we don't have challenges of deployment," said its, chief human resources officer Saurabh Govil, referring to last year's onboarding delays by the company. Premium compensation, global exposure and greater ownership of business functions have caused a 20-25% lateral movement of talent from IT services, said Kapil Joshi, CEO of Quess IT Staffing.
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