Active job openings in the IT sector has seen a 23 percent drop in August 2022, as compared to August 2021, according to a report by staffing firm Xpheno.
This is reflective of the several challenges Indian IT companies are beset by.
Withholding variable pay
This is also why they have been delaying the roll out of quarterly variable pay to the employees.
Employees in TCS, Infosys and Wipro have either seen deferring or partially cutting down on variable pay.
Wipro had held back variable payments for mid- to senior-level employees for the April-June quarter.
Infosys is paying around 70 percent variable amount on an average.
On a month-on-month basis as compared to July 2022 the IT industry registered 5 percent and 7 percent drop in job opening volumes respectively.
165K jobs were listed in August 2022, as against 172K in July 2022.
On a MoM basis this is a 4 percent drop in volume over June 2022.
The IT sector, which is known to contribute the highest number of openings, saw an overall drop to 63 percent against the 80 percent plus range it has maintained over the last year.
63 percent is also the lowest contribution that the tech sector has recorded over the last 30 months.
This trend echoes the margin pressures facing companies due to an impending recession in key markets like the US, inflation and a need to improve utilization rate after a year of record hiring in 2021.
Anil Ethanur, Co-Founder, Xpheno which reported the stats said that the JAS (July, August and September) quarter is emerging as a critical quarter in the COVID linked history of recruitment in India.
“The quarter is well set to be the corrective quarter for an otherwise hyperactive hiring funnel. With a controlled rate of drop in action, the quarter is set to be the stabilizer on an overheated talent graph in IT sector”, he added.
Employers regain control
The slowdown in hiring will help employers tackle unusually high attrition rates and unreasonable wage wars in the market.
Since there are now fewer jobs, the tides have shifted in favor of the employer once again, after over a year of operating in a candidate-controlled market.