Those over 50 years of age and still working in a domestic information technology (IT) company, should consider themselves lucky — really lucky — as they are part of just 1-2.5% of the company’s total employee base.
Consider the data on the age profile of employees at the India offices of IT companies. According to the country’s largest IT firm Tata Consultancy Services’ FY23 annual report, only 1.1% of employees on its rolls are in the 50 years+ bracket. In contrast, 52.69% of employees are below the age of 30.
A similar trend is observed at Infosys, the country’s second-largest IT firm. An ICICI Securities report states that around 2.5% of the company’s employees globally are above the age of 50, while 59.6% are below 30.
Although Tech Mahindra and LTI Mindtree have not yet released their FY23 annual reports, their FY22 numbers (LTI’s before the merger with Mindtree) demonstrate a similar pattern.
In FY22, just 0.03% of Tech Mahindra’s employees were 51 years and above, while 51.3% of the employee base were below 30 years. At LTI, below 30 years comprised around 46.3%, and above 50 were just 2%.
The situation is different in the US or Europe. For instance, only 17% of TCS employees in the US are less than 30 years old, and 21.8% are above 50.
What could be the reason for such asymmetry? V Balakrishnan, Chairman of Exfinity Ventures and former CFO of Infosys, suggests that age is never a factor in hiring in the US, as it is seen as discriminatory. He also points out that senior, experienced individuals are required for onsite work, which may explain the higher proportion of employees in their 50s in the US.
“Onsite work requires a lot of senior, experienced people because they have to work on the client side where transfer of knowledge is required,” Balakrishnan said.
Pareekh Jain, founder of Pareekh Consulting, shares a similar view. He notes that most senior management teams of Indian IT companies are based overseas. Jain adds that the retirement age in the US is higher than in India, which could also be a contributing factor.
However, Jain believes that the trend may change in the US in the future. He predicts that the percentage of employees in the 30+ age bracket will rise in the US because IT companies are reducing the cost of subcontracting in the US and Europe. As a result, local hiring will predominantly occur in the lower age group.
Sunil C, CEO of TeamLease Digital, states, “As you age, the opportunities start tapering down in the Indian IT services industry. That’s why we see people nearing their 50s moving laterally to global capability centers (GCCs) or other sectors that require IT solutions.” He adds that many individuals leave larger IT services companies and move to smaller firms in leadership positions.
Demographic factors could also explain why India has a larger workforce in the age group below 30. Currently, 25.3% of the country’s total population is below 15, and 42% of another 26.6% of the population is in the age group 15-29, actively seeking job opportunities. With a significant portion of the population in the age group 15-29 and more individuals entering this age group, there will be a greater demand for productive opportunities in the next five years. This results in larger hiring in the younger age group.