The hiring frenzy in the tech sector will continue and it will take at least a year for the attrition to subside as the pressure to poach from rivals abates.
“The sector is adding 400,000-500,000 a year and we do not see demand easing soon," said ISF president Lohit Bhatia.
The tech sector currently employs about 4.5 million people. The industry body, which sees a large portion of the workforce with 0-8 years experience, does not expect any of the tech firms to change their non-compete clauses.
“I don’t think any organization would completely open the no-compete clause and allow people to walk away with data and customer information," Bhatia said.
ISF’s comments come on the back of a Pune-based labour union’s appeal to the Union labour ministry seeking removal of the non-compete clause by IT giant Infosys. The clause, a common practice in the industry, prevents employees from joining a rival firm on similar projects, clients, and geographies.
The focus on these clauses come at a time when the tech sector is battling record high attrition. Infosys, Wipro, Tata Consultancy Services (TCS) and HCL Technologies faced record high attrition levels in the March quarter. Infosys posted an attrition rate of 27.7%, while TCS had an attrition rate of 17.4% during the quarter. Wipro clocked an attrition rate of 23.8%, while that of HCL was 21.9%.
However, ISF’s Bhatia said that the attrition numbers will come down in a year. “Attrition is hovering around 25%. It will ease in a year once tech firms with their hybrid policies hire from smaller towns. This will ease pressure to recruit from rivals in cities," he said.
The industry body is optimistic that hiring demand will be seen beyond technology as hospitality, aviation and retail sectors return to pre-pandemic levels.
Most of the job roles are “covid proof" where only a few may run the risk of a salary dip, according to a study by recruitment firm TeamLease Services. The Jobs and Salaries Primer FY 2021-22 was done from salary data of 410,000 employees and it showed that salaries grew by a minimum of 4.11 % and a maximum of 10.71% across sectors in FY22.
