Weak global macro conditions and a banking crisis in the US saw the country’s top four IT firms – TCS, Infosys, HCL Technologies and Wipro – hiring 66% less employees in FY23 than a year ago. Total hiring by these four firms in FY23 was at 82,679 compared to 243,258 in FY22.

Analysts said that the talent market is returning to the pre-pandemic times with FY23 numbers being closer to that of FY21, when net addition was at 86,685 employees.

TCS saw the sharpest decline in hiring at 78% in FY23, followed by Wipro at 70%. The decline in net addition by HCL Tech and Infosys was at 57.2% and 46.3%, respectively, on a year-on-year basis.

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The decline in hiring comes at a time when all the companies reported a drop in attrition rates. For instance, during the January-March quarter, TCS, the country’s largest IT firm, saw its attrition rates drop to 20.1% compared to 21.3% in the preceding quarter. Similarly, Infosys’ attrition rate came down to 20.9% from 24.3%, HCL Tech’s fell to 19.5% from 21.7% and that of Wipro was at 19.2% from 21.2% in the preceding quarter.

Though higher net additions indicate better demand, with the utilisation rate of the IT companies being low, the declining attrition rate means that the firms have the headroom to grow and do not need aggressive hiring.

“If you look at quarterly annualised attrition, our attrition rate has come down by 4.2% from last quarter to this quarter. For future, I expect it to come down to pre-pandemic levels in the second half of this year,” Milind Lakkad, chief HR officer said, TCS, said at the post March quarter earnings of the company.

During the January-March quarter, TCS saw net addition of just 821 employees, compared to the preceding quarter, when it saw a net drop of 2,197. Infosys saw a net addition of 29,219 in FY23, a drop of 46.3% from 54,396 net employee addition the company made in FY22. It also saw its total employee headcount falling to 343,234 at the end of March quarter from 346,845 in the December quarter.

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In the case of HCL Tech, net employee addition was 17,067 in FY23, against 39,900 during FY22, a drop of 57.2%. The total employee headcount for HCL Tech at the close of FY23 was 225,944.

The drop in net addition of employees saw an increase in revenue per employee by all the companies in FY23. TCS’ revenue per employee increased to Rs 36.6 lakh in FY23 from Rs 32.4 lakh in FY22. Similarly, revenue per employee for Infosys increased to Rs 42.7 lakh compared to Rs 38.7 lakh in FY22. HCL Tech and Wipro also saw their revenue per employee go up to Rs 44.9 lakh and Rs 35.2 lakh, respectively, in FY23, from Rs 41 lakh and Rs 32.5 lakh.