Bangalore: A clear separation between the leaders and laggards is becoming apparent in India’s $100-billion information technology (IT) sector, and this time it’s not about which company is growing revenues faster.
Scrambling to regain their lost momentum in revenue growth, Infosys Ltd and Wipro Ltd are beginning to lose out on retaining their staff—an indication that software engineers employed in the technology sector are reading quarterly earnings closer than before.
In a clear shift that’s been taking shape since the December quarter of 2010, India’s largest software exporter, Tata Consultancy Services Ltd (TCS) and the fastest-growing Cognizant Technology Solutions Corp. broke away from the pack and formed the new top order in staff retention.
For the three months ended September, TCS reported its lowest quarterly staff attrition in 10 quarters at 13.1%; that’s nearly 7 percentage points lower than what it reported for the same quarter two years ago. Infosys’s attrition in the latest September quarter was 20.5%.
At Cognizant, the attrition rate dropped from 21.8% in the quarter ended September 2010 to 12.1% in the June quarter, the latest period for which numbers are available.
The highest attrition rate was reported by HCL Technologies Ltd, a company that boasts of an “employees first” motto. HCL’s attrition in the September quarter was higher than that of its peers at 25.3%, but much reduced from the 36.4% it reported for the same period in 2010.
Last year, Infosys deferred annual salary hikes citing lower demand for services, but was forced to announce wage increases of up to 8% in the latest September quarter.
Employee surveys conducted by online networking site Glassdoor.com also indicate the companies growing faster are rated ahead of the laggards. According to the latest Glassdoor ratings, only 38% and 20% of Infosys and Wipro staffers, respectively, approve of their chief executives.
The ratings are based on feedback from select staff and not the total employee base. For TCS, the Glassdoor rating for its CEO is 100%, and nearly 82% of those polled by Glassdoor at Cognizant approve of the firm’s CEO Francisco D’Souza.