January 25, 2025 12:36 am (IST)
Follow us:
facebook-white sharing button
twitter-white sharing button
instagram-white sharing button
youtube-white sharing button
Indian students in US are quitting part-time jobs amid Donald Trump's deportation plans: Report | Ensure fair proceedings: Suspended MPs to Lok Sabha Speaker after Waqf bill panel meet row | Saif Ali Khan's attacker Shariful Islam's police custody extended till January 29 | Ordnance factory blast in Maharashtra leaves 8 dead | Heard screams from Jeh's room: Saif Ali Khan records statement with police on stabbing incident | Trump administration arrests over 500 people, deports hundreds in major crackdown on illegal immigration | Russia-Ukraine war would end immediately if Saudi Arabia cuts down oil prices: Donald Trump | 'Come make your product in America or pay tariff': Donald Trump's message at Davos | Saif received 5 stabbing injuries, was brought to hospital by his friend: Medical report | Punjab Police to withdraw additional security provided to Arvind Kejriwal
India's IT sector has witnessed increase in revenue per employee. (Image courtesy: Unsplash)

Indian IT firms face rising wage bills as demand for skilled professionals grows

| @indiablooms | Jan 15, 2025, at 04:37 pm

New Delhi: As Indian IT companies experience higher revenue productivity amid slower workforce expansion, HCLTech CEO C Vijayakumar has underscored the sustained demand for skilled professionals, which will contribute to escalating wage costs, media reports said.

"The service industry has a long-term correlation with adding people. While headcount growth may not align directly with revenue growth, the need for skilled and experienced professionals will drive wages higher," Vijayakumar was quoted as saying by The Economic Times.

During a post-earnings discussion, the CEO attributed recent growth to better resource utilization and evolving onshore-offshore workforce strategies.

Although major IT firms have reduced hiring over the past two years, the sector’s revenue per employee rose by approximately 6% year-on-year during the first half of FY25.

HCLTech, for example, revised its fresher hiring target for the year from 10,000 to 7,000 and added 2,134 employees in the December quarter, bringing its total workforce to 220,755.

To address concerns about low pay increases, the company implemented an average salary hike of 7% for eligible employees.

Vijayakumar highlighted how generative AI (GenAI) is reshaping developer workflows, particularly for tasks involving low to medium complexity code.

"Embracing generative AI is the key message for the developer community. It opens new avenues like application modernization, which was previously considered unfeasible," he explained, reported The Economic Times.

Although GenAI is reducing repetitive tasks, it is simultaneously driving demand by enabling projects that were previously unattainable.

HCLTech has observed a gradual increase in proof-of-concept (PoC) conversions into revenue-generating opportunities, reflecting wider industry adoption.

The CEO also noted a trend toward shorter contract terms, which impacts total deal values but sustains a strong annual contract value.

"Shorter durations reflect market dynamics, but year-over-year comparisons of annual contract values show strength," he said, according to the report.

With innovations like generative AI and shifting workforce patterns, Indian IT companies are navigating the evolving landscape by balancing technological progress with increased productivity.

Support Our Journalism

We cannot do without you.. your contribution supports unbiased journalism

IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.

Support objective journalism for a small contribution.
Related Videos
Nirmala Sitharaman on Budget 2024 Jul 23, 2024, at 09:30 pm
PM Modi on Budget 2024 Jul 23, 2024, at 09:30 pm
Close menu