Indian IT Biggies Grappling With Attrition

India’s top three IT companies are grappling with high attrition rates. Employees at the Tata Consultancy Services (TCS), Wipro and Infosys are jumping the ship at a rate faster than ever. 

Annual attrition rate at Infosys stood at 18.9% while it was around 15% at Wipro and 14.9% at TCS at the end of March 2015. The companies are attempting to tackle this problem in their own ways.


During the year ended March 31, 2015, TCS lost 47,931 employees to attrition. It has a workforce of over 300,000. To battle attrition, TCS plans to reduce the time that an employee spends on a project. The company is also planning online learning and focus on digital tech. Earlier this year, the company had declared a one-time bonus to commemorate its 10-year listing anniversary on the Indian stock markets.

Infosys announced a 100 per cent variable bonus payout to its employees in January 2015 in order to stem increasing attrition. The company had witnessed several exits, especially of senior level executives, in the last couple of years and one of the main tasks before Vishal Sikka when he took over as the chief executive officer last year was to check the high attrition levels. Infosys had a total headcount of over 169,000 at the end of December 2014.

Some time back, Wipro had launched “Notch Up”, its biggest employee-retention programme, aiming to stem the exodus of experienced executives. It offered employees a chance to study at some of the nation’s premier engineering and management colleges such at Symbiosis (Pune), BITS (Pilani) and VIT (Vellore).

Whatever the case may be, it is clear that the companies are uncomfortable with the high churn out rate of its employees and are trying various incentives including hefty bonuses. How long will these strategies work and whether the high attrition rate will have an impact on the business going forward is something only time will tell.

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Managing the expectations of employees is one of the biggest challenges in India’s IT sector where companies poach staff from rivals as a matter of routine. Attrition levels generally show an upswing during the first quarter of every fiscal year, when employees leave in search of better opportunities or to pursue higher education.

Some experts doubt if measures like these would truly help IT firms fight off employee exits as they believe stubbornly high attrition rates are symptomatic of a shortage of technically skilled engineers in the services industry and lack of challenging opportunities for growth.

According to a NASSCOM survey, during 2015, the IT industry is likely to be marked by higher attrition levels that will force firms to spend more on employee retention through wage hikes and innovative incentive schemes.

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