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Job-hopping has resurfaced as a trend in the information technology (IT) industry after a year of freeze on promotions and recruitment due to recession. Job-hopping has resurfaced as a trend

in the information technology (IT) industry after a year of freeze on promotions and recruitment due to recession. Attrition levels are touching double-digit figures across IT companies.

“There has been a definite rise in attrition across the industry in the past two-three months. With markets improving and the number of job offers going up in the new financial year, we are

bound to see more movements,” TV Mohandas Pai, board member and director (human resources), Infosys, told DNA. He, however, said the job-hopping this time was not accompanied by high salary

gains. “The industry will not grow like it did previously and therefore, it is not really a boom time for salaries,” Pai said. Mphasis CEO Ganesh Ayyar said attrition had gone up by 12% in

the company in the past few months. According to Teamlease, one of the largest staffing solution firms in the country, “a steady and drastic increase in attrition levels” has been seen since

January-February. “Attrition began mid last year. However, around December 2009,  it went up by 20% from the previous quarter. In the past three months, companies have seen almost 25%-30%

rise in attrition compared to last year,” the company’s general manager, Surabhi Mathur Gandhi, said. She said till June last year, companies were reeling from recession. Now, however, the

job market has opened up and employees are looking for pay hikes and job opportunities. “We expect attrition levels to go up even higher in the coming quarters,” Gandhi said, adding that

current estimates indicated that by the end of 2010, attrition will be 30%-35% higher. Ganesh Natarajan, vice-chairman and CEO of Zensar Technologies, said attrition had already risen from

2009’s 6%-7% to 10%-11%. “This is almost 50% higher than last year’s figures in corresponding quarters. In the coming months, all companies are likely to see people switch jobs and the

numbers would be higher in large firms,” he said. “There is almost a 30% increase in new replacement positions in companies, which shows that people are moving out in large numbers,” Gandhi

said. S Janakiraman, president and group CEO (product engineering services), MindTree Ltd, said every economic recovery sees a jump in attrition as people start looking for opportunities

with better rewards. “It [attrition rate hike] is a short-term spike that occurs after every slowdown and will vanish. We had seen a similar trend in 2001-02 when the market rebounded after

a slump of two years,” he said. Janakiraman estimated the industry attrition rate to have doubled to 13%-15% in the past two months. “It is cutting across verticals, but we are seeing a

sharper climb in consumer appliances and engineering services. It is a correction,” he said. E Balaji, CEO of Ma Foi Management Consultancy Ltd, also said rise in attrition was a normal

phenomenon after a period of slowdown. “The downside of every recovery is increase in attrition and wage inflation. We have to see what the percentage of increase is and which industry and

region are most affected?” E Balaji said the all-India attrition rate was up 10% this month from 5%-6% last year. He said the rate was highest in Bangalore and concentrated in the IT-BPO

sector, which was worst hit by recession. “In the IT-BPO sector, attrition is much higher at 15.16% compared to the industry average of 10%-12%.” Experts in Mumbai said the rise in attrition

was a result of market turnaround and internal restructuring. For instance, India’s second-largest IT firm Infosys Technologies saw attrition rise from 10.9% in Q2 (July-August-September)

to 11.6% in Q3 that ended December 2009. Wipro also saw a sharp rise in attrition from 10.5% in Q2 to 13.4% in Q3. Analysts said the turnaround in the economic scenario was throwing up job

opportunities with better perks and remuneration. Besides, the restructuring exercise undertaken by some firms has caused resentment among employees, prompting them to look out. For example,

about 2%-3% of the workforce at Infosys did not like the company’s recently launched role and career enhancement programme and the firm lost 4,000 employees in February alone. However, IT

industry insiders do not think attrition has increased greatly. “Attrition shot up in the November to January period, but has since returned to normal.  As lateral hiring is

experience-based, I believe there was a spurt in such hiring in that period. A dot doesn’t create a trend,” Jeya Kumar, CEO, Patni Computer Systems Ltd, said.