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Slowdown blues: IT firms set to halve campus hiring

Last updated on: January 7, 2013 09:34 IST

Slowdown blues: IT firms set to halve campus hiring

Bibhu Ranjan Mishra and Itishree Samal in Bangalore/Hyderabad

ith uncertainties of the global economic volatility still looming, hiring by information technology companies is set to hit the slow lane this year. According to estimates by industry analysts and experts, campus hiring by the IT industry is expected to drop 50 per cent, while lateral hiring (of experienced employees) is going to be purely need-based.

In 2012, hiring by the industry through campus interviews stood at about 200,000, the highest ever. But the number this year is estimated to drop to 80,000-100,000.

In 2013, Infosys, India's second-largest IT services company, through campus programme, plans to hire about 6,000 people - a significant climb down from last year's 23,000. Hyderabad-based Mahindra Satyam plans to cut down on its campus hiring by almost half because of an uncertain business environment.

The TeamLease-IIJT Employment Outlook Report for January-March 2013 says both net employment and business outlook have dropped on their respective indices, hinting at stagnation in hiring in the forthcoming quarter. "IT/ITeS and infrastructure are the laggards that drag the index down, while the outlook for other sectors is near-flat," the report says.

"I certainly expect a cooling down in campus hiring this year. Everyone has restricted hiring plans. This means the opportunity landscape will be relatively small. I would expect the top-20 IT players to add just 10-12 per cent to their overall workforce in 2013, compared to 17-20 per cent in 2012," said B S Murthy, CEO of Leadership Capital, a recruitment consulting firm.

The slowdown shadow is looming on performance evaluation systems, too. Though the large-scale retrenchment the IT industry saw in 2009-10 looks unlikely, there are talks that most top-tier IT companies in India have started looking at their employees' performance evaluation very seriously. They are understood to be using tools like competency examinations to 'weed out' non-performers.

As part of its routine staff management, Infosys encourages "chronic underperformers" to leave, the company says.

"I am clearly seeing a trend where two-three things are happening. First, companies are eliminating roles that are not administrative or do not require facing customers. The hiring pattern of IT companies shows that lateral hiring would be only need-based this year. Besides, companies will go very slow on campus hiring," said Kris Lakshmikanth, founder CEO of Headhunters India, an executive search firm.

Usually, 90-95 per cent of the IT industry's manpower requirement is met from campus recruitment. The rest is done through hiring experienced people from within the industry. The top 30 companies account for recruitment of about 70 per cent of freshers hired from colleges and academic institutions.

Photographs: Mike Segar/Reuters