Despite turmoil and turnover, India’s IT titans preserve their global prestige

The information technology services sector, once a beacon of rapid employment and stable career trajectories, is witnessing an unsettling transformation. A confluence of global economic uncertainty, shrinking project pipelines, and technological disruption has led to widespread layoffs, a sharp uptick in attrition, and a growing sense of vulnerability among workers, particularly at the entry level.

“There’s massive attrition and layoffs happening across IT services companies because the market has gone dull,” said a Tata Consultancy Services (TCS) employee, who previously worked at two other major IT firms. “Both companies and employees are impacted when macroeconomic uncertainty strikes. But employees can mitigate career risks by continually upskilling.”

That sentiment echoes across the industry, where “on-bench” status - a period during which employees await project assignments, has become increasingly common. “It’s a precarious time,” another IT employee explained. “Being on the bench creates fear. If there’s no project, you’re scrambling, either to get staffed or to find another job.”

Harpreet Singh Saluja, president of the Nascent Information Technology Employees Senate (NITES), called the recent terminations of hundreds of trainees “emotionally devastating” for recent graduates who relocated, invested time and money, and were ultimately left jobless.

“Mass hiring typically occurs when companies expect a major project,” said one employee. “But when deals fall through, it often ends in layoffs.”

The layoffs, Saluja noted, have grown more frequent over the past decade, often couched in corporate language such as “rightsizing” or “market corrections.” “It’s cost-cutting at the expense of those most vulnerable, trainees, freshers, and contract staff,” he said. “If companies begin to treat human capital as disposable, that should concern everyone.”

Despite cycles of hiring and firing, the brand reputation of India’s major IT services firms has remained largely intact, weathering both domestic scrutiny and global turbulence.

“Brands like these aren’t built overnight,” said Mohit Hira, co-founder of Myriad Communications. “They’ve developed strong moats over the years, surviving macro-level shifts and crises.”

Samit Sinha, founder of Alchemist Brand Consulting, pointed out a key differentiator: “IT services firms aren’t as beholden to public perception as FMCG or retail giants. But that doesn’t mean internal culture isn’t important. A strong work environment is itself a brand in the IT world.”

That internal perception, bolstered by diversity, equity, and inclusion (DEI) scores, environmental commitments, and transparency, has become critical for firms serving global clients, said Kiran Khalap, managing director of Chlorophyll Brand Consulting. “Reputation is only truly damaged when there is willful negligence or exploitation.”

Indeed, when the Karnataka Labour Department recently investigated Infosys following complaints from laid-off trainees, the firm was cleared of any labor law violations. In a statement, Infosys emphasized that “All freshers, after undergoing extensive foundational training at our Mysuru campus, are expected to clear internal assessments. Failing to do so results in discontinuation.”

Employees corroborated that similar expectations exist across other companies. A Wipro employee described a multi-phase vetting process before trainees transition into full-time roles, including aptitude tests, interviews, rigorous training, and final assessments. Many are subject to a probation period of three to six months.

Cost pressures and flattened salaries

While India’s IT services firms have long been the primary driver of the nation’s talent pyramid, the financial burden of onboarding entry-level employees is steep.

According to staffing firm Xpheno Private Limited, the cost of absorbing 10,000 freshers translates to a direct annual salary load of Rs400–450 crore, with an additional Rs100–120 crore in overhead. Despite these investments, returns are neither immediate nor guaranteed.

With revenue margins under strain and a cautious market outlook, many firms are scaling back campus hiring initiatives. Compensation, too, has stagnated.

“Freshers’ salaries haven’t changed much since the pandemic,” said Neeti Sharma, CEO of TeamLease Digital. “Entry-level pay remains in the Rs3–4 lakh per annum range. While offers occasionally rose during COVID, growth has been largely flat. In contrast, professionals with eight or more years of experience are seeing packages of up to Rs22 lakh.”

Amid the tightening job market, Global Capability Centres (GCCs) and multinational corporations (MNCs) are emerging as attractive alternatives for engineering graduates.

“GCCs are gaining traction because of their compelling employee value proposition - innovation, quality of work, learning, and total rewards,” said Yadhu Kishore Nandikolla, Human Resources Director at Evernorth Health Services India. However, their hiring volumes are limited. “They recruit selectively, targeting highly skilled professionals,” said Biju Davis, SVP of Engineering at Model N.

Still, Davis believes that traditional IT services firms continue to play a crucial role. “They offer jobs at scale, helping absorb the wider talent pool that may not find placements at niche GCCs.”

Internal branding and the AI revolution

Industry experts suggest that a robust internal brand has become essential for companies to attract and retain young talent. “Two decades ago, I had about six internal branding clients. Today, there are 46,” said Harish Bijoor, founder of Harish Bijoor Consults Inc. “Firms that invest in their internal culture are reaping long-term rewards.” Alagu Balaraman, CEO of DeepSell, added that companies have used employer branding to bring in large numbers of freshers at relatively low costs, ensuring competitive profit margins.

But just as branding efforts have matured, the technological landscape has shifted. Generative AI tools are enabling significant gains in programming productivity, prompting companies to reevaluate headcounts and role expectations.

“Capgemini and others are upskilling their workforce in AI,” said one IT employee. “But if employees don’t keep pace, they may be let go.”

Skills in AI, machine learning, cloud computing, and automation have not only increased job security at firms like Infosys, Wipro, Tech Mahindra, HCL Tech, TCS, and Accenture, they’re also commanding premium salaries.

“Entry-level professionals with AI expertise are securing offers up to Rs12 lakh per annum,” said Anupama Bhimrajka, VP of Marketing at jobs platform foundit. “Hiring is now about building agile, skill-based teams that can adapt with technology.”

Still, the rise of AI is generating concern. “There’s a growing perception that AI will replace jobs,” Balaraman noted. “Companies will need to rethink long-standing metrics, like billing rates versus salaries, and find new ways to preserve their attractiveness on campuses and in the job market.”