Techies get a reboot, IT firms, the boot

Information technology (IT) professionals are back in demand with the revival in global economies.

And with that, voluntary attrition rates of tech services firms have also started soaring.

Azim Premji-owned Wipro Ltd on Friday said its voluntary attrition rate for global IT services in the fourth quarter shot up to 17.1% from 8.4% in the first quarter. The two other tech majors—Infosys Technologies and Tata Consultancy Services (TCS)—have also seen attrition rates jump in the recent times.

However, Pratik Kumar, HR head of Wipro, does not see this as cause for concern. He expects the high employee churn in his company to calm down “in a quarter or two.” He says such employee exits also help in career progression cycle by creating career opportunities for many. And despite the high employee turnover, the company will be selective in hiring.

Azim Premji, chairman of Wipro, said his company would hire “in line with volume and demand growth.”

The third largest IT firm gave a hike after 18 months and added 5,325 employees in the March quarter. Interestingly, Wipro intends to increase proportion of local nationals in the total workforce at its overseas locations. In the US, it has risen to 39% from 29% in just one quarter. Premji said it will go up to 50% by next year.

E Balaji, chief executive officer (CEO) of MaFoi Management Consultant Ltd, said since attrition was an outcome of the demand and supply of talent in the market, it was not surprising that it was climbing up with resurge in demand. He, however, said today’s rates were still lower than peak levels of 2005-06. Balaji says as per his firm’s estimate, the IT industry is expected to hire around 1.1 lakh during this years as volumes pick up in the coming quarters.

The consultancy firm has forecast  salaries to go up by 15% in the current year compared to last year.

“We expect wages of mid-managers to increase the most. They will command the highest premium because of their leadership capability,” he said. It will take two more quarters for salaries to go back to the pre-crisis levels.