IT hiring slump: Indian IT firms experience drop in average training hours

Indian IT firms Infosys, Wipro, and Tech Mahindra have reported a significant drop in average training hours per employee for FY24 compared to the previous year, ToI reported. This decline is primarily attributed to fewer freshers being hired and a shift towards just-in-time hiring amidst reduced client spending and sluggish demand.

Infosys saw its average training hours per employee fall drastically from 130 in FY23 to 74.6 in FY24. Similarly, Tech Mahindra experienced a decline from 56 hours to 49 hours during the same period. Wipro also reported a reduction in total training hours, dropping from 16 million in FY23 to 12.9 million in FY24.

Industry analysts suggest that the main reasons for this reduction are the lower intake of freshers and the just-in-time hiring approach. With many clients pulling back on discretionary spending, Indian IT firms have been gradually onboarding freshers promised jobs in the previous fiscal year while making only modest additions to their overall headcount.

TCS, which hired 40,000 fresh graduates, significantly increased its training hours to 87 hours per employee in FY24 from 40 hours in the previous fiscal year. Freshers typically undergo extensive training upon joining, and companies count both online and offline training modules completed by employees when calculating total training hours.

An email sent to TCS, Infosys, Wipro, and HCL did not receive a response at the time of publication, as these firms are currently in a quiet period.

Despite the challenges posed by the pandemic in 2021, the Indian tech sector added 1.3 lakh employees, reaching a total base of 4.4 million. However, the net addition of 60,000 employees in the recent period pales in comparison to the hiring frenzy of FY22, which saw 4.5 lakh freshers onboarded—the highest addition in a single year. By FY24, the combined headcount of Infosys, Wipro, and TCS had dropped by nearly 64,000 employees.

Richard Lobo, Chief People Officer at Tech Mahindra, remarked that the decline in training hours is temporary and that the company expects an increase in employee upskilling as it focuses on cost optimization.

"Overall training hours are down as project loads are light and staff levels remain tight. This has led to a focus on billable hours and revenue in the short run, versus training in the long run," said Ray Wang, founder of IT advisory Constellation Research.

Ray Wang also highlighted that TCS is the only company concentrating on a long-term strategy rather than short-term benefits.

(with ToI inputs)