Bucking the industry trend of the last five quarters, IT services company Tech Mahindra reported a decline in attrition rate (last-twelve-month basis) which stood at 22 percent for the first quarter ended June 30, 2022, as compared to 24 percent in Q4FY22.
Though the attrition rate is still higher than Q1FY22 which came in at 17 percent.
The company added 6,862 new hires in Q1, taking its total headcount to 158,035.
Tech Mahindra had added around 6,106 new hires in Q4FY22 and 5,209 in the same quarter last year.
In terms of freshers hiring, Tech Mahindra had added around 10,000 freshers in FY22 and targets to add a similar number in FY23.
‘The supply bases we have added in Tier-2 cities like Chandigarh, Nagpur and Coimbatore are now coming up to speed. I think the attrition rates in those cities will be lesser. Delta’s overall impact will be lesser," CP Gurnani, Managing Director & Chief Executive Officer, Tech Mahindra said.
He added, "In general when an industry goes through a rapid surge, there is shock with attrition rate running at 23-24%, I think that shock stage is now coming down. Earlier we used to plan our business at 17-18% attrition, which I estimate it to be in the next two quarters.”
The company is also actively creating campuses and hiring talent from the Tier-II and Tier-III markets. In an earlier interview with Moneycontrol, Gurnani shared that he won’t be surprised if 20 percent of the company’s talent came from Tier-2 and Tier-3 cities in less than two years.
Commenting on the company’s performance in Q1, Gurnani said, “We are starting this fiscal with a renewed commitment towards delivering consistent organic growth. We remain resilient and watchful given the dynamic global macro-economic environment and will continue investing in new technologies to deliver differentiated offerings. Our winning strategy rests on the pillars — ‘Purpose, People and Performance’ which is aiding us to capitalize on the strong demand environment in the market responsibly.”
