Attrition woes may subside, says TCS; employee addition tapers down

Attrition at Tata Consultancy Services (TCS) continues its upward trajectory in the September quarter, but the software major believes it has peaked and will taper down hereon.

The employee attrition rate inched up to 21.5% in the July-September quarter from 19.7% in April-June.

“We believe our quarterly annualized attrition has peaked in Q2 and should see it taper down from this point, while compensation expectations of experienced professionals moderate,” Chief HR Officer Milind Lakkad was quoted as saying in the release.


While the management did indicate that the attrition rate would come down, it did not offer any quantitative guidance.

Notably, the employee additions at the leading software major slowed down considerably in the last quarter. In Q2, TCS net added just 9,840 employees, which was the lowest in many quarters. The net quarterly addition has been in five digits in the last five quarters.

A general slowdown in the biggest markets of IT companies has triggered concerns that firms might slow down on hiring. Whether the employee addition number hints at this, one does not know and will have to wait for clarity on client budgets.

Speaking at a post-earnings press conference, the management said clarity on client budgets will emerge in the next 3-6 months.