India’s second-largest information technology company, Infosys, is relying more on experienced hands than fresh graduates even though it weighs to its costs, according to the company’s latest annual report. This is happening when the sector is witnessing slower growth with increasing pressure on profit margins.
According to the latest annual report for 2017-18, the percentage of the Bengaluru-headquartered company’s employees in the age group of 18-25, came down to 28.16 per cent, from 31.19 per cent in the previous financial year. In absolute terms, the number of employees in this group was 57,475, against 62,489 in FY17. Employees in this group largely constitute of newly-hired engineers from colleges.
The percentage of employees above this age group had gone up during this period. For example, employees in the age group of 26-30 constituted 32.25 per cent of the total staff strength in FY18, against 32.09 per cent in the previous year. Similarly, mid-level employees in the age group of 31-40, constituted 32.5 per cent, which rose 168 basis points over the previous financial year. The ratio of employees in the 41-50 age group also saw a rise of 100 basis points over the previous financial year to 5.92 per cent. However, despite the higher ratio of experienced staff in workforce, Infosys incurred only 3.6 per cent rise in expenses towards salaries and bonus in FY18 to Rs 346.7 billion.
The change in Infosys’s employee mix also reflects the growing trend of slower fresher hiring by Indian IT firms, expected to gain pace in the current financial year as well. Owing to uncertain demand environment and changes in client demands, Indian IT companies are hiring fewer number of freshers while majority of them are resorting to just-in-time hiring in case of lateral (experienced ones).
“The intake of fresh engineers by Indian IT firms is certainly going to drop further as companies are seen steadily improving their (employee) utilisation rates. While they are no more hiring in bulk through campus recruitment programmes, the normal attrition in higher age groups is also less owing to lesser avenues outside which means the ratio of senior staff that the sector employs will go up,” said Kris Lakshmikanth, chief executive officer & managing director of Head Hunters India.
Infosys said the percentage of senior management level employees in the age group of 51-60 was 1.03 per cent, against 0.90 per cent in FY17.
Employees above 60 years of age constituted 0.19 per cent of the overall strength, which was at 0.14 per cent in the previous financial year.