Tata Consultancy Services (TCS) has deferred the announcement of annual wage hikes for FY25 appraisal cycle, citing growing global uncertainties and their impact on client decision-making. The move comes as macroeconomic concerns, including the spectre of a global trade war, have begun to affect the business environment and delay project decisions and closures across key markets.
“We will take a call on the timing and the quantum of wage hikes in the coming months,” Milind Lakkad, chief human resources officer, TCS, said during the company’s post-earnings media briefing. Traditionally, TCS announces its salary revisions in the first quarter of the fiscal year (in this case FY26), with revised salaries paid in the second quarter along with arrears for the first. This year, however, the company has chosen to postpone the announcement.
While Lakkad refrained from offering specifics on the potential size of the hike, he reiterated that the decision would depend entirely on how the business environment evolves over the coming quarters. Despite the deferment, he assured that the company would continue investing in its workforce, particularly in upskilling initiatives. “There will be no reduction in the investments towards training, whether for trainees, lateral hires, or existing employees,” he said.
TCS CEO and MD K Krithivasan said the company had witnessed early signs of recovery in discretionary spending during the third quarter, but momentum slowed again in fourth quarter due to ongoing macro-level uncertainty. “Since mid-February, some projects have begun ramping down, though we havee not seen any large-scale cancellations,” Krithivasan said.
In terms of headcount, TCS added 625 employees during the January–March quarter, reversing a sharp sequential decline of 5,370 employees seen in the December quarter. The total employee base at the end of March 2025 stood at 607,979, an increase of 6,433 over the course of the fiscal year. The company also promoted 110,000 employees during FY25, with promotions distributed fairly evenly across the four quarters.
TCS also confirmed that its fresher hiring drive remains on track. In FY25, it on-boarded 42,000 trainees and expects to maintain, if not increase, that pace in FY26. “Our trainee on-boarding in FY25 was 42,000 as planned, and next year too, we expect to on-board as many, if not more,” Lakkad said.
Attrition ticked up slightly to 13.3% during the quarter from 13% in during the October-December period, marking the third straight quarter of increase, though Lakkad downplayed the concern, highlighting that the quarterly annualised attrition rate actually fell by 130 basis points. This comes after attrition had hit a multi-year high of 21.5% in the second quarter of FY23 before trending downward.