TCS attrition rate drops to 20.1%, remains far from pre-pandemic levels

The attrition rate at IT bellwether Tata Consultancy Services (TCS) dropped marginally by 1.2 per cent in the fourth quarter of financial year 2022-23 to reach 20.1 per cent. But it remained much higher than the pre-pandemic levels of 12-13 per cent. 

India’s largest IT company added 22,600 employees during FY23, which is a big drop from the net addition of 1.3 lakh people it reported in FY22.

The net addition of the company is the lowest in the last eight years. The company added 821 people to its workforce in the last quarter of FY23. Its headcount had reduced by 2,197 employees in the previous quarter.

The total headcount of TCS stands at 614,795 as on March 31, 2023.

The company will pay 100 per cent variable pay this year and continue with normal pay hikes in the range of up to 12-15 per cent for good performance, the company leaders said after announcing the results.

Milind Lakkad, chief human resource officer (CHRO) of TCS, said the attrition is expected to come to a pre-pandemic level only by the second half of the year.

“The attrition came down from 21.3 per cent to 20.1 per cent. The reduction seems low because of the way LTM attrition is calculated. But if you look at the quarterly annualized attrition, it came down by 4.2 per cent compared to last quarter. That’s a huge thing,” Lakkad said.

The management of TCS has also reaffirmed that its fresher on-boarding target remained unchanged. It added that the company does not plan to defer from on-boarding freshers it hired last year.

“We are honouring all job offers, and have added 22,600 employees on a net basis in FY 23. During the year, we on-boarded over 44K freshers and our highest-ever number of experienced professionals. We also doubled down on organic talent development, obtaining over 53K cloud certifications during the year, bringing the total to over 110K employees certified on hyper scaler platforms,” said Lakkad.