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Recruitments, which are a strong indicator of the expected business for software firms, have suffered a significant drop while placements for the coming season are reflecting the uncertainty in global financial markets.
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The top four IT exporters have nearly frozen hiring of experienced professionals and have deferred the joining dates for many freshers, analysts said. Around a week or two back, number one software exporter Tata Consultancy Services (TCS) reportedly sent out letters postponing joining dates by six to nine months, people familiar with the situation said.
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“This quarter, we don’t immediately see a drop in revenues. But we expect the next quarter to show flat to negative growth for some of the top firms,” said an IT analyst, adding that TCS had the highest exposure to financial services among the top-tier firms with around 43-44% of its revenues coming from financial services.
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According to a survey conducted by brokerage CLSA in 45 colleges, the class of 2009 has received 17.4% lesser job offers compared to the previous year’s figures. Offers from Satyam and Wipro were about 33-50 % lower while that of TCS and Infosys Technologies were 16% and 12% lower, respectively. Regarding the class of 2008, the study noted, “Companies have pushed out the joining dates for the graduating class of 2008.
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Admittedly, the class of 2008 was given job offers in 2007, pre-slowdown and companies have ostensibly over-hired relative to demand.” The numbers could not be confirmed with the IT firms because they were in the silent period before their second quarter results. A Satyam spokesperson said, “We haven’t changed our 12,000-15,000 guidance for new hires—we will honour our commitments.
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We are in our silent period, and as of now, not commenting on specifics like joining dates.” An analyst with a domestic brokerage noted that TCS had scaled down the number of hires it had projected for the year from 35,000 to 30,000 while multinational IBM had asked about 1,000 employees to leave. “Infosys is the only firm that has so far stuck to the number of 25,000 hires that it had initially given out,” he said.
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The CLSA survey, which is probably the first comprehensive survey after the slowdown, said Accenture was the only large firm to have shown an increase in hiring numbers among the colleges it visited. The colleges were spread across eight cities and the top IT exporters had collectively hired 7,278 freshers from them last year. This year, the figure was down to 5,835, the brokerage said.
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In addition, the IT firms were pruning the number of colleges they visited for placements and dropping tier-2 and tier-3 colleges from the list. Infosys, which visited around 1,079 campuses last year, has scaled the number down to 620 this year, while Wipro has reduced it from 300 to 106.
