Even as India's second-largest IT services company Infosys kickstarted FY20 with strong growth momentum, its attrition rate continues to be high at 23.4 percent, up 3 percent from 20.4 percent for the quarter ended March 2019.
The company's attrition for quarter ending June 2018 stood at 23 percent.
UB Pravin Rao, Chief Operating Officer, told mediapersons that the high attrition could be attributed to seasonality and high involuntary attrition.
"We are living at a time where there are technological disruptions happening and there has been a shortage of skills. We are seeing high degree of attrition due to shortage of talent. Once it stabilises and talent gap minimises we will go back to 13-15 percent. Till then it is likely to continue," Rao said.
He said the company has put in several measures to address the issue. He informed that the company has launched an employee value proposition focusing on engaging better with employees, enabling them and creating better career opportunities.
"During current compensation review, we will address some of it," he added.
However, there have been some concerns about wage hikes this quarter at the senior management level. Rao explained that at the lower level people start getting hikes a little early in July and senior management starting October.
"That is something that the management has been following in the recent years and there has not been any change in that approach," he added.
On the hiring front, the company has hired 8000 people so far, 2500 being freshers.
"We are planning to hire 18,000 people from campuses for FY20," Rao said.
Infosys has completed its promise to hire 10,000 people in the US. However, there are no new targets for US hiring.
Despite the increased hiring numbers in the US, subcontracting cost continues to be high at 7.5 percent of revenues. "It is become an integral part of the supply chain," Rao said, adding that it helps fill the talent gap as and when needed.
Infosys is also looking beyond STEM and is hiring, especially in the overseas market, to overcome the skill gap.
During investor call, Ravi Kumar, President, Infosys, said, “We are going beyond stem. It is very new to us and we have started experimenting it with community colleges as well. It is a very exhaustive list of learnings and where we can sharpen this model and sustain this for a long term.”
"The key is to retain industry growth and have their career with us for the long run," he said.
Profit for the quarter ended June 2019 stood at Rs 3,802 crore, down from Rs 4,078 crore in March 2019 quarter. The company registered revenue of Rs 21,803 crore, up 14 percent from Rs 19,128 crore for the comparable quarter last year.
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