IT sector opens lateral hiring’s

Finally after many quarters, some of the major tech companies have started opening their doors for new hires, particularly at the middle level, this has lightened the hope.

The hiring done at middle level is known as ‘lateral hires’, or people with prior work experience. The information technology companies have explored new service lines and verticals to broaden their revenue streams thus have boosted the demand for experienced people.

For instance Cognizant Technology Solutions, said, the slowdown in the hiring process in the last couple of months was actually an opportunity to select good talent.

Francis D Souza, president and CEO, told an analyst meet immediately after the second-quarter financials, “Venturing into new domains was the reason behind lateral hires. We brought in 400 people — across levels — on board in the second quarter, while at the same time utilization went up by 3%”.

In the last nine months Cognizant had hired 9,000 employees.

While Wipro, the country’s third-largest software services exporter, did lateral hiring for niche skills in telecom and data warehousing, informed Pradeep Bahirwani, vice-president, talent acquisition.

He told most of the positions were on the junior level and middle-management, but he did not give the exact number.

But, the top two of Indian IT do not share the buoyancy.

T V Mohandas Pai, director, human resources at the firm said, “Infosys will resort to lateral hiring only if it is inevitable”.

On the other hand India’s largest software company, Tata Consultancy Services, also told that at present they have not done any lateral hiring.

Pradipta Bagchi company spokesperson told, “We may hire laterally as and when the need arises. We have not set any target numbers for this”.

This fiscal company will undertake 24,885 campus hiring.

The No. 5 HCL Technologies did not revealed any thing citing silent period before results.

But in this whole process, companies said that it is not easy to find the right talent. Therefore the hiring cost has increased and by default, headhunters benefit.

Kunal Banerji, CEO of Absolute International, a human resources firm, informed that there has been decrease of 25% from Rs 60,000-75,000 in the cost per hire for infotech companies before November for talent in the salary bracket of Rs 4-8 lakhs.

Thus the, cost for hires in the salary bracket of Rs 8-12 lakhs has come down to Rs 1 lakh and for a salary of Rs 25 lakhs it is up 20-30% of the CTC from 20%-odd earlier.

He added although there has been increase in the volumes of hiring of specific skills but the talent pool readily available for specific skills is still small.

He said, “From October 2008-February 2009, we recruited only 500 lateral hires for IT clients. But post February, it is 350-400 candidates a month”.

A R Rajesh, the vice-president of staffing solutions company TeamLease informed there has been 10% jump quarter-on-quarter in lateral hiring. “There is demand for R&D and production.”

Thus he feels that the cost per hire will come down once the market start recovering.

Moreover with the increase in the hiring volumes the salary levels are also slowly but surely picking up.

Banerji said, the lateral hires are capable of bargaining on average salary hikes of 15-20% in their new jobs.

Thus these are the clear indications towards the uprising of the hiring market for the tech sector after a slump.