TCS loses 2,197 employees and attrition remains above 21% in third quarter

Tech giant Tata Consultancy Services (TCS) on Monday said its total workforce saw a net reduction of 2,197 employees in the October-December 2022 period from the previous quarter while attrition slowed down marginally to 21.3 percent even as the firm’s management had earlier indicated that attrition had bottomed out.

TCS’ loss of employees during the third quarter of the fiscal compares with 9,840 net additions in the July to September quarter in which it had already hit a nine-quarter low. The company’s total headcount now stands at 6,13,974.

“The improved productivity was achieved by focusing on utilizing the excess capacity built up over prior quarters and through investments in organic talent development. In Q3, TCSers clocked 11.4 million learning hours, resulting in the acquisition of 1.3 million competencies, the firm said in its financial results statement for Q3," the company said.

High attrition rate, the gradual reduction of workforce by employees leaving and not being replaced — rather than by redundancy — have remained a concern for the past few quarters especially for tech firm’s. In the second quarter of the 2022-2023 financial year, the attrition rate of top five tech IT giants in India — Infosys, Wipro, TCS, Tech Mahindra and HCL Tech — averaged at about 23 percent.

In the December quarter, TCS attrition rate had come down marginally from 21.5 percent and the firm expects it to fall further in the forthcoming quarters. It remains to be seen how other tech giants fared given an impending recession in the US concerns and a challenging micro environment.

During the quarter, the technology bellweather's net profit exceeded Rs 10,000 crore for the second straight quarter, even as it came in below CNBC-TV18 poll estimate.

Its revenue at Rs 58,229 crore was higher than the poll projection of Rs 57,475 crore. In rupee terms, TCS reported revenue growth of 5.3 percent compared to the September quarter.