Stung With High Attrition, Indian IT Firms Shortlisting 5 Applicants For Hiring One Employee!
The information technology industry in the country is witnessing a revolutionary shift, in terms of demand for new-age digital skills.
In addition to burgeoning attrition rates in the IT industry, job-seekers today are negotiating simultaneously with three to four companies at an average, for better salary offers.
Furthermore, such employees are being presented with over 50-70% joining hikes, given the increasing demand for niche digital skills and not enough supply, catalysed by the Covid-19 pandemic. The demand for not only lateral hiring has increased proportionally with fresh hiring.
Industry experts in a report have stated that IT companies and recruiters are now having to shortlist at least 5 candidates for one single job role while hiring, as backups, given the record high attrition rate figures in the sector.
Attrition Rates Highest in a Decade
Tech hiring for IT recruiters has become nothing short of a ‘headache’, states the CEO of EMA Partners India. With a massive surge in demand for new-age digital skills in the IT sector, businesses are forced to shortlist 5-6 candidates for the same role and still there is no surety if they will take the offer, he adds.
“Depending on the digital skills you are hiring, an offer pipeline of at least 50-75% higher in the supply chain is a must for hiring companies to be able to get closer to the desired onboarding ratio,” states Kamal Karanth, cofounder of Xpheno.
Attrition rate in the IT domain is at its all-time high in a decade, at 24.4%, driven by a rally in hiring demand, both for replacement hires as well as fresh hiring.
In order to retain employees, tech companies are also giving steep increments and more promotions in the current financial year, with promotions in digital talent cited at 13.1%, compared to the overall figure at 11.6%.
Why Are Employees Eager to Switch Companies?
According to Aon data, one of the major reasons for the attrition rate to climb up the charts is not getting paid well enough by the employer, besides limited growth opportunities in the current organisation, underutilisation of skill sets and nature of the work, cites the publication data.
“The talent market continues to be competitive, reflective of the significant surge in demand after a challenging year and the magnitude of opportunities ahead of the IT services industry,” states a spokesperson at Mindtree.
He adds that the current attrition figure is likely to simmer down soon.