IT companies lay off 2,500 new employees who appeared in the screening test

“We expect around 2,500-plus freshers to be dropped from these companies due to poor performance, post-training,” said Anshuman Das, chief executive and co-founder, CareerNet, a talent solutions provider. The number of campus hires has been less as compared to the last two years amid the Covid-19 pandemic.

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Screening tests usually take place within a year of a campus recruit joining an IT firm and are performed to assess whether the new employee will match the requirements of ongoing client projects. Das estimated that out of about 200,000 recruits from engineering colleges in FY23, around 2% may not clear these exams. Usually, freshers who fail to clear these screening tests constitute around 1% of the total hires.

Media reports say that Infosys may fire 600 employees who fail the screening test.

Wipro also left a few hundred. Wipro responded by saying, “We let go of 452 freshers because they repeatedly performed poorly in assessments, even after training.” PeppermintInquiry of.

Wipro said its assessment process includes “assessment to align employees with business objectives” of the firm and its clients. Company employees,” it added.

Spokespeople for Infosys, Tata Consultancy Services and Tech Mahindra did not respond to this. Peppermintseeking clarification on the matter. A spokesperson for HCL Technologies said the firm does not conduct screening tests after recruitment.

Industry experts expect the screening tests to be more stringent. “Companies are under pressure to honor campus offers and the cut-off marks of these screening tests are changing,” said Harpreet Singh Saluja, president of the Nascent Information Technology Employees Senate, which looks into the grievances of employees in the tech sector.

Questions have also been raised about the quality of campus recruitment as India’s top IT companies rush to fill positions amid a boom in digitization projects over the past two years. “Many leading IT companies faced additional demand in the market due to increase in digital deals across client segments, which led them to hire aggressively amid the war for talent. It is highly likely that such hiring would have led to an inadvertent fall in standards, which at some point in time mandates a natural demand for reform,” said Chirjit Sengupta, partner, global technology services at consulting firm Everest Group.

Tata Consultancy Services, Wipro, HCL Tech, Infosys and Tech Mahindra estimated a combined recruitment of 180,000 freshers for the year beginning FY23. During the latest earnings season last month, all the companies said they had either met or were on track to meet the hiring targets given at the start of the year.

However, the pace of hiring for new projects has slowed down significantly in the past two months. New jobs in the IT services and business process outsourcing (BPO) sectors fell for the second consecutive quarter, down 15% last month, said a January 2023 report by employment tracker Foundit (formerly Monster), published on February 8.

IT companies also said that the pace of hiring is likely to be slow in the rest of FY2023 as most of the targets for the financial year have been met.

Akshara Bassi, an analyst for global cloud and servers at market researcher Counterpoint India, speculated that the reduction in workforce among IT majors was due to cost management. “What we can expect is that the bottom of the employee pyramid is facing a greater threat of keeping their jobs. This is an indicator that there are headwinds in the coming quarters, even though the overall order execution pipeline is strong at the moment,” Bassi said.

TCS, Infosys, Wipro and HCL Tech are also grappling with high employee costs, despite a decline in total headcount. Despite a sequential decline (from 56.2% in the September quarter to 55.1% in the December quarter), salary cost as a share of revenue is still higher than in the same quarter a year ago. However, Bassi said that while the junior workforce doesn’t add much to costs, the stricter screening “could essentially be a headcount consolidation exercise rather than a major move to save costs.”