Accenture’s headcount declines after 2 quarters in Q2FY24, follows footsteps of Indian peers

Accenture’s headcount declined by 723 employees to 742,318 in Q2FY24

Following in the footsteps of its Indian peers, information technology major Accenture Plc’s headcount declined sequentially after two quarters in the quarter just gone by. IT companies have stopped backfilling positions left vacant due to attrition in the recent past because of weak demand.

On March 21, Accenture’s headcount declined by 723 employees to 742,318 in Q2FY24. Accenture follows a September-August financial year.

In the third quarter ending December 31, 2023, top five Indian IT companies reported a reduction of 14,931 employees sequentially.

Given that a substantial portion of Accenture's workforce is based in India, its results often serve as an indicator of the broader trends and potential outcomes within the over-five-million strong Indian IT sector.

Also read: Accenture’s tepid outlook implies more pain for Indian IT even in FY25

Accenture’s attrition rate also increased by 2 percentage points to 13 percent for the quarter, at a time when most IT companies are seeing downward trajectory for this metric.

On the declining trend in headcount, top executives IT companies had unanimously told Moneycontrol that they would first put the existing workforce to use, while adding that hiring will be resumed if and when demand picks up pace.

However, leading Indian IT players in the space are divided on the impact of disruptive technologies, such as Generative Artificial Intelligence (Gen AI), on job redundancy. There's a divergence of opinions within key players regarding the extent to which emerging technologies might replace certain roles.

Nonetheless, top honchos of these firms argue that their employee headcounts are expected to increase once demand rebounds. In the interim, major companies such as TCS, Infosys, Wipro, and others plan to enhance efficiency by leveraging their current talent pool rather than reducing it.

For Q2FY24, Accenture lowered its revenue forecast for fiscal year 2024 on March 21, due to economic uncertainty leading clients to reduce spending on consulting services.

Accenture's revised outlook anticipates full-year revenue growth to be within the range of 1 percent to 3 percent, compared to its earlier projection of 2 percent to 5 percent.

Also read: IT stocks bleed as Accenture lowers guidance, Nomura pessimistic on TCS, Wipro, LTIMindtree, L&T Tech

In Q2FY23, Accenture had said that it would be cutting 19,000 jobs — or 2.5 percent of workforce at the time — in 18 months, including over 800 of its 10,000-plus leaders as a manner of slashing its structural costs. Towards this end, the company had expected to incur $1.2 billion in employee severance and other personnel costs.